In re Kirklin - Cramdown Motion Denied, PMSI Extends to Entire Claim

Fri, 24 Apr 2026 02:11:19 +0000
Bankruptcy

The US Bankruptcy Court for the Eastern District of Louisiana denied the Debtors' Cramdown Motion seeking to bifurcate Ally Bank's secured claim on a 2016 Chevrolet Camaro under 11 U.S.C. §§ 506(a), 1322(b)(2), and 1325(a)(5). The Court held that under Louisiana UCC § 10:9-103(a)(2), Ally Bank holds a purchase-money security interest (PMSI) in the entire claim amount, including $1,195.00 for gap insurance and $2,477.00 for a Service Contract. The hanging paragraph of § 1325(a) therefore prevents bifurcation, leaving Ally Bank's entire $22,118.97 claim treated as secured.