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Rising Home Values and Chapter 13: A Deepening Split

When, post-confirmation, a chapter 13 debtor sells his or her home, who gets the benefit of the appreciation: the debtor, or his or her creditors? Judge Randon in Michigan adopted the so-called “estate replenishment approach” and held that sale proceeds derived from post-confirmation appreciation of a home belong to the debtor.

Circuits Are Now Split on Who Gets Appreciation in a Home When a ‘13’ Converts to ‘7’

Splitting with the Tenth Circuit, the Ninth Circuit holds that chapter 13 debtors lose post-petition appreciation in a home if the case converts to chapter 7.
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BAP Gives Post-Petition Appreciation to Chapter 7 Estate on Conversion from Chapter 13

In a rising real estate market, chapter 13 debtors risk losing their homes if they sell or convert to chapter 7.
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