Negative Equity

NEGATIVE EQUITY ISSUE NOT RULED UPON IN 1327 CASE
In re Kuhasz, Case No. 07-20282
November 2008, Judge Somers

Court noted split within the district. Judge Karlin excluded negative equity from PMSI claim in In re Padgett, 389 BR 203, while Judge Nugent included it. In re Ford 387 BR 14827 but declined to rule on the issue because the plan had been confirmed and the elements of 1329 had not been met.

NEGATIVE EQUITY ROLLED INTO LOAN IS NOT PMSI
In re Padgett, Case No. 07-41284
May, 2008 Judge Karlin

Car creditor objected to debtor’s attempt to avoid paying the negative equity in a 910 case. After analyzing the UCC as it exists in Kansas, the Court confirmed its opinion in Vega, but disagreed with Judge Nugent’s decision in Ford.

NEGATIVE EQUITY IS PMSI FOR PURPOSES OF 910 CAR LOANS
In re Ford, Case No. 07-11561
May 2008, Judge Nugent

Court held that negative equity in a trade in vehicle, financed by lender, is a part of the price of the collateral and constitutes value given to enable debtors to acquire collateral. The entire balance was found to be a “910” obligation under the hanging paragraph of 1325.

NEGATIVE EQUITY IS NOT PMSI
In re Kellerman, Case No. 06-22028
August 2007, Judge Berger

Pre petition payments are to allocated between refinanced negative equity and the PMSI portion of a 910 vehicle claim under 1325(a)’s hanging paragraph by reference to KSA 84-9-103(c). Under Kansas law, PMSI is the purchase price, not negative equity. Start with the vehicle’s cash purchase price and the apply pre petition payments in accordance with the parties written agreement. If no agreement or other manifested intent, the prepetition payments are applied first to unsecured negative equity and then to PMSI.

How Much Is My Attorney Paid to Defend Dismissal?

WICHITA NO LOOK FEE FOR DEFENDING MOTIONS TO DISMISS MAY BE $350.00
In re Kiser, Case No. 06-11453
January 2009, Judge Nugent

Debtor filed a motion to modify plan to increase monthly payment and to pay attorney fees of $500.00. Court allowed $400.00. Judge Nugent quoted Judge Karlin in Beck in supporting its conclusion that a presumptive fee of this nature may be appropriate.

How Much Are Chapter 13 Bankruptcy Fees in Wichita?

13 ATTORNEY FEES IN WICHITA
In re Mayer, Case No. 06-10013
October 2006, Judge Nugent

This is Judge Nugent’s fee decision. The “presumptive” fee in Wichita is $2500, without prejudice to fee applications, based upon the language of 330, testimony and the various factors recited.

Digest by:  Jan Hamilton, Trustee

Reconversion Fails, No Discharge Bankruptcy Dismissed

CONVERSION CONFUSION
In re Fry, Case No. 04-16887
October 2008 Judge Nugent

Debtor converted from 13 to 7 and then learned she was not eligible for a 7 and attempted to converted back to 13. Case dismissed as an “end run” around 7 discharge.

Digest by:  Jan Hamilton, Trustee