In re Castillo

MEMORANDUM DECISION SUSTAINING IN PART DEBTOR’S OBJECTION TO ALLOWANCE OF SECURED CREDITOR’S CLAIM

Debtor and debtor in possession Idalia Roxana Castillo (the “Debtor”) owns rental property located at 38563 Larkin Avenue, Palmdale, California 93550 (the “Property”), which the Court has valued for plan purposes by order entered July 11, 2012 at 1500,00o. 1 Deutsche Bank National Trust Company (“Deutsche”) holds a first deed of trust against the Property to secure the repayment of a promissory note in the approximate principal amount of $1,031,330.56.

The Debtor filed her Second Amended Chapter 11 Plan of Reorganization [docket no. 131] on October 31, 2012 (the “Plan”). Deutsche made a timely election of the application of Bankruptcy Code section 1111(b)(2) with regard to its Class 6 claim under the Plan. The original proof of claim that Deutsche filed in the above chapter 11 case in June of 2012 reflects a total claim of $1,072,498.04. On December 13, 2012, Deutsche filed an amended proof of claim (the “December Claim”) that increased the total amount due Deutsche to $1,207,652.57. Other than certain post-petition real property taxes and insurance payments that are no longer the…