Can a confirmed Chapter 13 plan extinguish a mortgage lender’s lien—even if the creditor never objected? The Eleventh Circuit Court of Appeals says no.
In re Bozeman, the court delivered a significant win for mortgage creditors, holding that the Bankruptcy Code’s anti-modification provision (§1322(b)(2)) prevails over the finality of a confirmed plan under §1327. The ruling makes clear that a homestead mortgage lien survives bankruptcy unimpaired—regardless of how a debtor’s plan treats the underlying claim—and that a creditor’s failure to object does not strip it of that protection.
ALAW Bankruptcy Partner Jeffrey S. Fraser breaks down the Bozeman decision, tracing the court’s reasoning through competing Code provisions, prior precedent including Nobelman and Bateman, and the Supreme Court’s Espinosa ruling. Fraser explains what the decision means in practice: creditors must still comply with the plan during a proceeding, but upon case completion, §1322(b)(2) remains an ironclad shield.
Read the full article in Legal League Quarterly Q2 2023 →