Case Law on Stripping Wholly Unsecured Junior Mortgages Without a Discharge in Chapter 13

By: John Gustafson, Standing Chapter 13 Trustee, Northern District of Ohio, Western Division

A. The cases for, and the cases against.

This leads to the next question – and the actual topic of this presentation: what if the debtor is not entitled to a Chapter 13 discharge? Can the provisions of Section 506 be used, in combination with a confirmed Chapter 13 plan, to strip liens in a Chapter 13?

Initially, a strong majority of decisions followed Jarvis and held that stripping a junior mortgage is prohibited in a Chapter 13 where the . . .

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