How to Compel Surrender of Real Property in Bankruptcy
A debtor who files a chapter 7 bankruptcy case must also file a statement of intention with respect to a secured creditor’s collateral, and then perform that intention within a certain period of time. In the Eleventh Circuit, a chapter 7 debtor has only three options with respect to collateral: surrender, redeem, or reaffirm the secured debt. The Eleventh Circuit, in In re Failla, 838 F.3d 1170 (11th Cir. 2016), held that a bankruptcy court has the power to compel a debtor to surrender real property by directing the debtor to withdraw any and all defense to the state court foreclosure action.
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