What IS a Principal Residence?

By Phil Lamos, Chief Legal Counsel, Office of the Chapter 13 Trustee Lauren A. Helbling (Cleveland, OH)

Section 1322(b)(2) of the Bankruptcy Code states that a Chapter 13 plan may not modify a claim that is “secured only by a security interest in real property that is the debtor’s principal residence.” But the inverse of this statute is true; if a debtor can prove that a claim is secured by something other than “the debtor’s principal residence” then the claim can be modified in a Chapter 13 plan. A debtor can bifurcate or even . . .

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