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9th circuit purchase money case
Hiyas:
So I read the opinion and I want to make sure I get it and how to apply it:
If a debtor bought a car WITHIN the 910 day period for which a portion of
that financing to obtain that car included payment of the debtor's existing
debt on another vehicle. . . .
Then I can bifurcate the claim between secured purchase money and that
portion which was financing.
So...... my question is, when I have a client who buys car for $20K and
Finances at let's say $25K because $5K went to pay off the old car. . . .
And let's say they have paid in $8K over two years and now want to file for
chapter 13. This leaves a balance of $17K.
Do I deduct from the balance of $17K the $5K that went in as non-purchase
money and bifurcate to $12K? (I wish and hope but don't believe is
correct); or
Do I do a ratio/proportion and split the payments proportionately 80%/20%
i.e. the original deal was an 80/20 split between purchase money and payment
of old debt. So now you apply the same 80/20 split to bifurcate the
remaining claim?
Or.... will some nice creditor come along and argue that the $8k paid in
first went to pay that part of the loan that makes up the pay off of the
prior loan and interest on the car, and that there is only like $1000 that
was applied to the secured interest leaving a balance of $24K?
And POSSIBLY should we be watching for auto finance companies to change
their finance contracts to prioritize the payment on old debt and interest
first before payment on the secured portion of the vehicle begins? Can they
legally do that?
As a young practitioner in bankruptcy, I will probably be among the first to
get one of those cases where the loan has been written to prioritze the
payments and my bifurcation gets denied because I didn't fully and carefully
read the loan contract. Good Grief. Maybe I and others like me can avoid
this problem if I ask these questions now.
What are your thoughts?
R. Grace Rodriguez
(818) 734-7223
On Fri, Jul 16, 2010 at 4:21 PM, Patrick Green wrote:
>
>
> The opinion said that there eight other circuits going the other way and
> that the court did not create the split lightly, but they adopted the well
> reasoned opinion of the BAP.
>
>
>
> If you have any questions or concerns, please contact me.
>
>
>
> Pat
>
>
>
> Patrick T. Green, Esq.
>
> Fitzgerald & Green
>
> Attorneys at Law
>
> 1010 E. Union Street
>
> Suite 206
>
> Pasadena, CA 91106
>
> Tel: 626-449-8433
>
> Fax: 626-449-0565
>
> pat@fitzgreenlaw.com
>
>
>
>
>
> *From:* cdcbaa@yahoogroups.com [mailto:cdcbaa@yahoogroups.com] *On Behalf
> Of *Nancy Clark
> *Sent:* Friday, July 16, 2010 4:06 PM
> *To:* cdcbaa@yahoogroups.com
> *Subject:* RE: [cdcbaa] 9th circuit purchase money case
>
>
>
>
>
> Great work! I wonder if it will be appealed to the Supremes.
>
>
>
> Nancy Clark
>
> Borowitz & Clark, LLP
>
> 100 N. Barranca Avenue, Suite 250
>
> West Covina, CA 91791
>
> Office: (626) 332-8600
>
> Fax: (626) 332-8644
>
>
>
> Privileged/Confidential Information may be contained in this message. If
> you are not the addressee indicated in this message (or responsible for
> delivery of the message to such person), you may not copy or deliver this
> message to anyone. In such case, you should destroy this message and kindly
> notify the sender by reply email. Please advise immediately if you or your
> employer does not consent to Internet email for messages of this kind.
> Opinions, conclusions and other information in this message that do not
> relate to the official business of my firm shall be understood as neither
> given nor endorsed by it.
>
>
>
> IRS Circular 230 Disclosure: To ensure compliance with Treasury Department
> Regulations, we advise you that, unless otherwise expressly indicated, any
> federal tax advice contained in this communication was
>
> not intended or written to be used, and cannot be used, for the purpose of
> (i) avoiding tax-related penalties under the Internal Revenue Code or
> applicable state or local tax law provisions or (ii) promoting, marketing or
> recommending to another party any tax-related matter addressed herein.
>
>
> ------------------------------
>
> *From:* cdcbaa@yahoogroups.com [mailto:cdcbaa@yahoogroups.com] *On Behalf
> Of *Patrick Green
> *Sent:* Friday, July 16, 2010 3:49 PM
> *To:* cdcbaa@yahoogroups.com
> *Subject:* [cdcbaa] 9th circuit purchase money case
>
>
>
>
>
> Congratulations to Professors Klee and Hayes on carrying the day in the 9
> th circuit. Negative equity car loans can now be bifurcated, with
> negative equity being unsecured.
>
> * *
>
> * *
>
> *In re Penrod* - filed July 16, 2010
> Cite as 08-60037
> Full text http://www.metnews.com/sos.cgi?0710%2F08-60037
>
>
>
>
>
> If you have any questions or concerns, please contact me.
>
>
>
> Pat
>
>
>
> Patrick T. Green, Esq.
>
> Fitzgerald & Green
>
> Attorneys at Law
>
> 1010 E. Union Street
>
> Suite 206
>
> Pasadena, CA 91106
>
> Tel: 626-449-8433
>
> Fax: 626-449-0565
>
> pat@fitzgreenlaw.com
>
>
>
>
>
>
>
R. Grace Rodriguez, Esq.
OFF: (818) 734-7223
CEL: (323) 304-5496
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Hiyas:So I read the opinion and I want to make sure I get it and how to apply it:If a debtor bought a car WITHIN the 910 day period for which a portion of that financing to obtain that car included payment of the debtor's existing debt on another vehicle. . . .
Then I can bifurcate the claim between secured purchase money and that portion which was financing.So...... my question is, when I have a client who buys car for $20K and Finances at let's say $25K because $5K went to pay off the old car. . . . And let's say they have paid in $8K over two years and now want to file for chapter 13. This leaves a balance of $17K.
Do I deduct from the balance of $17K the $5K that went in as non-purchase money and bifurcate to $12K? (I wish and hope but don't believe is correct); orDo I do a ratio/proportion and split the paymentsproportionately 80%/20% i.e. the original deal was an 80/20 split between purchase money and payment of old debt. /div>
Or.... will some nice creditor come along and argue that the $8k paid in first went to pay that part of the loan that makes up the pay off of the prior loan and interest on the car, and that there is only like $1000 that was applied to the secured interest leaving a balance of $24K?
And POSSIBLY should we be watching for auto finance companies to change their finance contracts toprioritizethe payment on old debt and interest first before payment on the secured portion of the vehicle begins? Can they legally do that?
As a young practitioner in bankruptcy, I will probably be among the first to get one of those cases where the loan has been written to prioritze the payments and my bifurcation gets denied because I didn't fully and carefully read the loan contract. Good Grief. Maybe I and others like me can avoid this problem if I ask these questions now.
What are your thoughts?R. Grace Rodriguez(818) 734-7223On Fri, Jul 16, 2010 at 4:21 PM, Patrick Green <pat@fitzgreenlaw.com> wrote:
The opinion said that there eight
other circuits going the other way and that the court did not create the split
lightly, but they adopted the well reasoned opinion of the BAP.
If you have any questions or
concerns, please contact me.
Pat
Patrick T. Green, Esq.
Fitzgerald & Green
Attorneys at Law
1010 E. Union Street
Suite 206
Pasadena, CA 91106
Tel: 626-449-8433
Fax: 626-449-0565
pat@fitzgreenlaw.com
From: cdcbaa@yahoogroups.com
[mailto:cdcbaa@yahoogroups.com] On Behalf Of Nancy Clark
Sent: Friday, July 16, 2010 4:06 PM
To: cdcbaa@yahoogroups.com
Subject: RE: [cdcbaa] 9th circuit purchase money case
Great
work! I wonder if it will be appealed to the Supremes.
Nancy Clark
Borowitz
& Clark, LLP
100 N.
Barranca Avenue, Suite 250
West Covina,
CA 91791
Office:
(626) 332-8600
Fax: (626)
332-8644
Privileged/Confidential
Information may be contained in this message. If you are not the addressee
indicated in this message (or responsible for delivery of the message to such
person), you may not copy or deliver this message to anyone. In such
case, you should destroy this message and kindly notify the sender by reply
email. Please advise immediately if you or your employer does not consent to
Internet email for messages of this kind. Opinions, conclusions and other
information in this message that do not relate to the official business of my
firm shall be understood as neither given nor endorsed by it.
IRS
Circular 230 Disclosure: To ensure compliance with Treasury Department
Regulations, we advise you that, unless otherwise expressly indicated, any
federal tax advice contained in this communication was
not
intended or written to be used, and cannot be used, for the purpose of (i)
avoiding tax-related penalties under the Internal Revenue Code or applicable
state or local tax law provisions or (ii) promoting, marketing or recommending
to another party any tax-related matter addressed herein.
From: cdcbaa@yahoogroups.com
[mailto:cdcbaa@yahoogroups.com] On Behalf Of Patrick Green
Sent: Friday, July 16, 2010 3:49 PM
To: cdcbaa@yahoogroups.com
Subject: [cdcbaa] 9th circuit purchase money case
Congratulations to
Professors Klee and Hayes on carrying the day in the 9th circuit.
Negative equity car loans can now be bifurcated, with negative equity being
unsecured.
In re Penrod - filed July 16, 2010
8-60037" target"_blank">
The post was migrated from Yahoo.
The opinion said that there eight other circuits going the other way and
that the court did not create the split lightly, but they adopted the well
reasoned opinion of the BAP.
If you have any questions or concerns, please contact me.
Pat
Patrick T. Green, Esq.
Fitzgerald & Green
Attorneys at Law
1010 E. Union Street
Suite 206
Pasadena, CA 91106
Tel: 626-449-8433
Fax: 626-449-0565
pat@fitzgreenlaw.com
The post was migrated from Yahoo.
Great work! I wonder if it will be appealed to the Supremes.
Nancy Clark
Borowitz & Clark, LLP
100 N. Barranca Avenue, Suite 250
West Covina, CA 91791
Office: (626) 332-8600
Fax: (626) 332-8644
Privileged/Confidential Information may be contained in this message. If
you are not the addressee indicated in this message (or responsible for
delivery of the message to such person), you may not copy or deliver
this message to anyone. In such case, you should destroy this message
and kindly notify the sender by reply email. Please advise immediately
if you or your employer does not consent to Internet email for messages
of this kind. Opinions, conclusions and other information in this
message that do not relate to the official business of my firm shall be
understood as neither given nor endorsed by it.
IRS Circular 230 Disclosure: To ensure compliance with Treasury
Department Regulations, we advise you that, unless otherwise expressly
indicated, any federal tax advice contained in this communication was
not intended or written to be used, and cannot be used, for the purpose
of (i) avoiding tax-related penalties under the Internal Revenue Code or
applicable state or local tax law provisions or (ii) promoting,
marketing or recommending to another party any tax-related matter
addressed herein.
________________________________
The post was migrated from Yahoo.
Congratulations to Professors Klee and Hayes on carrying the day in the 9th
circuit. Negative equity car loans can now be bifurcated, with negative
equity being unsecured.
In re Penrod - filed July 16, 2010
Cite as 08-60037
Full text
http://www.metnews.com/sos.cgi?0710%2F08-60037
If you have any questions or concerns, please contact me.
Pat
Patrick T. Green, Esq.
Fitzgerald & Green
Attorneys at Law
1010 E. Union Street
Suite 206
Pasadena, CA 91106
Tel: 626-449-8433
Fax: 626-449-0565
pat@fitzgreenlaw.com
Congratulations to Professors Klee and Hayes on carrying the day
in the 9th circuit. Negative equity car loans can now be
bifurcated, with negative equity being unsecured.
In re Penrod - filed July 16, 2010
Cite as 08-60037
Full text
The post was migrated from Yahoo.