Postpetition Borrowing by a Consumer Debtor in Chapter 13 – Part 2 of 2

By Judge Michael A. Fagone & Career Law Clerk Ciera S. Dye

III. Policy Considerations

Where the statute does not provide definitive guidance, courts often turn to policy considerations. How do those considerations weigh out here? One answer is that policy considerations cut against imposing any sort of requirement of preapproval for postpetition borrowing by a consumer debtor. Several reasons may justify a laissez-faire approach.

First, the voluntary nature of chapter 13 suggests that oversight of postpetition consumer borrowing may not be appropriate. A chapter 13 debtor has a right to convert her case to a . . .

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