Walters v. Bank of the West, No. 11-2449 (8th Cir. 2012)
Annotate this CaseDebtor appealed the BAP's decision affirming a bankruptcy court order that her homestead was not exempt from the Bank's antecedent debts. The court agreed with the bankruptcy court and the BAP that the plain language of section 561.20 of the Iowa Code limited the "new homestead" exemption to cases where "a new homestead has been acquired with the proceeds of the old." Therefore, the court rejected debtor's contention that there was a conflict in the published bankruptcy court decisions and held that debtor was properly denied a new homestead exemption. The court also held that the bankruptcy court did not err in concluding that the homestead was not exempt from the Bank's antecedent debts under section 561.21(A) of the Iowa Code as construed by the Supreme Court of Iowa and in lifting the automatic stay in bankruptcy as to that property. Accordingly, the court affirmed the decision.
Court Description: Bankruptcy - homestead exemption. Bankruptcy appellate panel's decision that homestead is not exempt from bank's antecedent debts is affirmed. Any new homestead exemption must have been acquired with the proceeds of the old and the new homestead exemption was properly denied. Proof of exhaustion is not condition precedent to the antecedent judgment creditor's right to petition for judicial sale of the homestead and bankruptcy court did not err in concluding Lakeview Drive homestead was not exempt under section 561.21(a) and in lifting the automatic stay.
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