Section 1322(b)(2)
Definition:
Section 1322(b)(2) of the United States Bankruptcy Code governs the modification of secured debts in Chapter 13 bankruptcy plans. It allows debtors to restructure most secured debts but specifically prohibits modifying the rights of lenders whose claims are secured only by the debtor’s principal residence. This section protects home mortgage lenders while allowing flexibility for other types of secured creditors.
Section 1322(b)(2) Information
Under Section 1322(b)(2), a debtor filing for Chapter 13 bankruptcy may propose a repayment plan that modifies the rights of secured creditors — for example, by changing payment schedules, interest rates, or principal amounts. However, this authority does not extend to creditors whose claims are secured solely by the debtor’s primary home. This protection ensures stability in the mortgage lending market while still permitting adjustments for other secured assets like vehicles or investment property. Courts interpret this section to mean that a mortgage secured by the debtor’s principal residence cannot have its repayment terms, balance, or interest rate altered through the Chapter 13 plan.
Florida Legal Definition
In Florida, Section 1322(b)(2) applies through the federal bankruptcy courts and follows national standards. Florida debtors cannot use Chapter 13 to reduce or modify the principal balance or interest rate of their home mortgage if it is secured only by their principal residence. However, the section does allow modifications if the mortgage is secured by additional collateral, such as rental property or personal items. Florida courts have upheld this interpretation in numerous cases, balancing lender protection with debtor relief. Additionally, Florida homeowners may still use other bankruptcy tools — such as curing arrears or extending payment timelines under **Section 1322(b)(5)** — to save their homes from foreclosure without altering core loan terms.
How It’s Used in Practice
In practice, Section 1322(b)(2) plays a crucial role in Chapter 13 bankruptcy filings, particularly for homeowners in Florida. Debtors can restructure most secured debts but must maintain regular mortgage payments on their principal residence. For example, a borrower behind on mortgage payments can use Chapter 13 to catch up over time but cannot reduce the total amount owed. Attorneys often analyze whether a mortgage includes additional collateral to determine if modification is allowed. Florida bankruptcy courts consistently enforce the home mortgage protection rule, ensuring both lender security and fair debtor relief within the law.
Key Takeaways
- Section 1322(b)(2) allows modification of most secured debts in Chapter 13 bankruptcy but protects home mortgage lenders.
- Mortgages secured only by the debtor’s principal residence cannot be modified in repayment terms or balance.
- In Florida, this rule is strictly enforced through federal bankruptcy courts to maintain mortgage market stability.
- Debtors may still cure arrears and reinstate loans through related provisions such as Section 1322(b)(5).
- The section balances debtor relief with lender protection, particularly for residential mortgage creditors.
Disclaimer: The information and opinions provided are for general educational, informational or entertainment purposes only and should not be construed as legal advice or a substitute for consultation with a qualified attorney. Any information that you read does not create an attorney–client relationship with Barnes Walker, Goethe, Perron, Shea & Johnson, PLLC, or any of its attorneys. Because laws, regulations, and court interpretations may change over time, the definitions and explanations provided here may not reflect the most current legal standards. The application of law varies depending on your particular facts and jurisdiction. For advice regarding your specific situation, please contact one of our Florida attorneys for personalized guidance.
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