Chapter 7 Bankruptcy ruling may help homeowners.
Publish Date : 5/11/2012 5:36:00 PM Source : CNNMoney.com
In In Re McNeal, Case No. 11-11352 (11th Cir., May 11, 2012), the 11th Circuit ruled that a debtor could strip off a home lien in Chapter 7 bankruptcy if no part of the lien is secured by the home’s equity (this is referred to as being “wholly unsecured”). It distinguished this situation from that discussed in the U.S. Supreme Court’s decision in Dewsnup v. Timm, which said you cannot strip off a partially unsecured lien in Chapter 7 bankruptcy.