Monthly Archives: June 2014

Lien Strip in Chapter 13 after Chapter 7 Now Permitted in South Florida: Scantling Decision 11th Circuit

Debtors may now strip off a second mortgage in a chapter 13 even after filing a chapter 7 in Fort Lauderdale chapter 13 cases and other South Florida chapter 13 bankruptcies.   This has been an issue across the country.  In South Florida, the local bankruptcy judges have ruled that a debtor could not eliminate junior mortgage liens after obtaining a chapter 7 discharge.  However, the 11th Circuit Court of Appeals today ruled today in the Scantling case that debtors can eliminate junior liens even in the so-called chapter 20, filing a chapter 13 after a chapter 7. This means that debtors who filed chapter 7 and are not eligible now to file bankruptcy again to obtain a discharge nevertheless can file a chapter 13 to eliminate second mortgages. I would like to thank Patrick Scott for sending me the following analysis: “Jeff Kuntz of my office shared with me today’s new…
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