Bigun--need your input on contested Chapter 7 proceeding.

[Dewey]

What is the name of your state (only U.S. law)? AZ

As a secured creditor, I have a hearing coming up since I objected to my debtors' motion to avoid our junior lien.

The debtors haven't paid their mortgage and the senior lien wants to foreclose. If allowed to do so, they will likely foreclose in deficiency since eveyone seems to agree that the house is worth approximately $30K less than what is owed. Therefore, we expect our lien to be wiped out.

Our hearing is before the senior lien's hearing. When I objected and requested the hearing--we were unaware that the debtors hadn't been paying their mortgage. It seems imminent that the court will allow the senior lien to foreclose (the debtors objected to the Relief from Stay of the senior lien, but with no valid reason. They said they knew they couldn't keep the house at this point and that they were requesting 4-6 months to move out!)

Given that knowledge, I'm having a hard time as to what I'm objecting to....it seems quite obvious that I won't have a lien to worry about in the next half-hour after my hearing!

Any guidance? I suppose I still want to vigorously defend our lien in the off-chance the house does auction better than we expect? Another question--Does our security extend to their personal property?

[bigun]

Unless your agreement included personal property as collateral, I don't see you having a claim.
I think your best course of action is a consultation with a local attorney and see if they have any ideas.