Bank of the Mountains granted a loan to debtors secured by a second mortgage on debtors’ primary residence. Debtors filed a Chapter 7 bankruptcy, which was later converted to a Chapter 13 case. Debtors listed the bank as an unsecured creditor since the value of their residence was less than the balance owing on the […]

Here, debtor purchased more than $1,100 of collector Barbie dolls and accessories within 40 days of filing for bankruptcy. Debtor sought to discharge these debts to the creditor who issued the credit card upon which the charges were placed. Creditor filed an adversary complaint with the Bankruptcy Court claiming that these Barbie doll purchases were “luxury […]

In this case, the Court addressed whether the prohibition against transfers to creditors prior to the bankruptcy filing begins from the date of transfer, or runs backward from the date the bankruptcy is filed. Here, the creditor obtained a judgment lien against the debtor’s property 90 days before the date of the filing of the debtor’s […]

Here, the debtor owed more than $3,900 to ITT Financial Services on a loan secured by various items of personal property, including a Pentax Camera and lens, snowblower, color television set, VCR, stereo system, a gun, power saw and an electric guitar. The initial debt was refinanced several times by the debtor and on each […]

A “cram down” in a Chapter 13 plan proposes repayment to the creditor of only the actual value of the collateral. Here, the debtor attempted to cram down a secured loan with an interest rate on the unpaid balance of less than the original contract rate and less than the prime rate of interest. Debtor’s […]

In this case, the Federal Court held that a guarantor on a loan is not excused from liability even when the principal debtor files bankruptcy. In this case, an obligation to the creditor was guaranteed by a third-party. The principal debtor filed bankruptcy and proposed to “cram down” the obligation to the creditor. Creditor filed an action […]

Here, the debtors somehow were able to have title to their vehicles issued that did not reflect the creditor’s lien. Debtors then filed a Chapter 7 Bankruptcy and Sears filed an adversary complaint with the Bankruptcy Court alleging the debtors committed fraud in having the creditor’s lien removed from the title. A discharge under the […]

Here, a state court judgment found the debtor liable for fraud. Although the federal court has exclusive jurisdiction as to determining dischargeability in bankruptcy, the federal court nevertheless found the debtor was precluded from refuting the state court judgment. Hence, the debtor could not collaterally attack the state court judgment in federal court, and the […]

Debtor issued three checks to his creditors prior to his filing a Chapter 7 bankruptcy, however, those checks had not cleared debtor’s bank at the time he filed bankruptcy. The Trustee in Bankruptcy sought an order compelling debtor to turn over the funds in his account at the time he filed for bankruptcy in the […]

Here, the court dismissed the debtor’s Chapter 7 bankruptcy even though the debts were entirely consumer in nature. Here, the court found that the debtor had the financial ability to repay most of his obligations and could have filed a Chapter 13 plan of reorganization. Although Congress did not define what “substantial abuse” meant when […]