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Lien Stripping

June 2, 2020

Kevin N. Summers

The U.S. Supreme Court ruled that the U.S. Bankruptcy Code does not allow Chapter 7 debtors to rid themselves of junior liens on home loans that are under water. This decision should benefit commercial lenders as debtors may not void a junior mortgage lien when the debt owed on a senior mortgage lien exceeds the current value of the collateral.

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