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Florida Banking Law Blog Legal developments impacting banking, finance and loan enforcement in Florida

Tag Archives: Chapter 20

The Threat of Lien Stripping in “Chapter 20” Bankruptcy

Posted in Bankruptcy, Debt and Judgment Collection

As discussed in the McNeal posts below, junior mortgage holders are increasingly finding that their mortgages are worth less than the paper they were printed on. Especially troubling to lenders, are conflicting decisions that allow liens, which otherwise would have passed through a Chapter 7 bankruptcy, to be avoided in a subsequent Chapter 13 proceeding…. Continue Reading

First Challenge to McNeal Reveals Lien Stripping Challenges for Chapter 7 and 13 Debtors

Posted in Bankruptcy, Commercial Lending, Debt and Judgment Collection

Nearly five months after McNeal was decided by the Eleventh Circuit, a challenge has arisen within the Eastern District of New York, which has historically been fertile ground for bankruptcy law. In Wachovia Mortgage v. Smoot, the court rejected a debtor’s attempt to strip off a wholly unsecured junior mortgage in a Chapter 7 proceeding,… Continue Reading