In Re Lance C. Barnes and Virginia R. Barnes, Debtors. Delbert Barnes and Ethel Barnes v. Lance C. Barnes Virginia R. Barnes
Opinion
Opinion
Thompson, J.
Delbert and Ethel Barnes (Creditors) appeal the district court’s order affirming the bankruptcy court’s confirmation of the Chapter 13 Plan of Reorganization of Lance C. and Virginia R. Barnes (Debtors). The Creditors argue that the plan’s failure to comply with 11 U.S.C. §§ 1325 (a)(5)(B)(ii) and 1322(c) required the bankruptcy court to deny confirmation. We agree and we reverse.
FACTS
The Debtors bought forty acres of land from the Creditors. They entered into a purchase agreement that provided for a purchase price of $73,750, with $4,750 to be paid immediately and $69,000 to be paid in annual installments of $8,190 over a period of twenty years. The Debtors defaulted on this agreement and filed a Chapter 13 petition in bankruptcy.
At the time the Debtors filed their Chapter 13 petition, they owed the Creditors $69,-000 under the agreement. The bankruptcy court fixed the value of the real property at $43,000, allowed the Creditors’ secured claim in that amount, and confirmed the Debtors’ Chapter 13 plan. The plan provided for annual payments on the allowed $43,000 secured claim with ten percent interest, amortized over nineteen years, the remaining term under the…