EraseMortgage_iSTockFor the past couple of years one of the benefits of being in the 11th Circuit states (Georgia, Florida and Alabama) is that you could strip an unsecured junior lien from a house.  These states were the only states in which this was available and it was because a higher court approved it.  This all came to an abrupt end on June 1, 2015 when the United States Supreme Court overruled the 11th Circuit and said the 11th Circuit was not properly following the law.  A detailed analysis of the law is generally beyond the scope of this site, but you can read a more detailed discussion of Bank of America, N.A. v. Caulkett, No. 13-1421 (June 1, 2015) by clicking here.

If you are one of the fortunate people who were able to take advantage of this benefit, how does the recent decision affect you?  Most likely, it does not affect your case at all.  Supreme Court cases like this are generally affective after the opinion is entered and do not relate back to prior cases.  Even if a lien stripping order was entered by the Bankruptcy Court just a few days before the Supreme Court order was entered, as long as the lender did not timely appeal or request reconsideration the lien is stripped.  It is important to note that the Supreme Court did not rule that lien stripping was, in any way, unconstitutional.  They merely interpreted the law and anytime Congress chooses to allow lien stripping in a Chapter 7 case they can change the law.