From the Editor – Lien Stripping

By The Honorable William Houston Brown (Retired)

Third mortgage could be stripped in plan. Agreeing with other circuit decisions, the Eighth Circuit held that a wholly unsecured third mortgage on the debtor’s principal residence could be modified and stripped. Section 506(a)(1) determines the extent to which a lien is secured, and § 1322(b)(2) does not prevent modification when there is no value to support the mortgage lien. Nobelman dealt with partially secured liens, and “the dividing line drawn by § 1322(b)(2) runs between the lienholder whose security interest in . . .

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