Is Dewsnup Unravelling Due to Lien-Stripping Cases under § 1322(b)(2)?

Feb 14 2017

The law of lien-stripping in consumer bankruptcy cases continues to evolve in two opposite directions. The anti-lien-stripping precendent of Dewsnup v. Timm, a chapter 7 case, is frequently disregarded in chapter 13 cases notwithstanding the specific directive of § 1322(b)(2), which states that a mortgage secured by a debtor's home cannot be modified. This evoution continues even though chapter 7 and 13 cases are interpreting the same statute applicable in both chapters: § 506. This has created a crescendo of confusion as to fundamental bankrutpcy concepts.