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ARUN GUPTA, ESQ. Nevada Bar No.: 11387 GUPTA LAW FIRM, LLC 800 N. Rainbow, #208 Las Vegas, Nevada 89107 (702) 493 1059 Fax (702) 543 3937 attorney@theguptalawfirm.com Attorney for Debtor IN THE UNITED STATES BANKRUPTCY COURT District of Nevada

In Re: Fayyaz M. Raja Kathleen A. Raja Debtors

Case No. 10-28885-LBR Chapter 11 Hearing Date: 08/03/2011 Hearing Time: 1:30 pm

Motion To Value Collateral, "Strip Off", and Modify Rights of Real Time Resolutions, Inc. Agent for Bank of America (fka Countrywide) Now comes Fayyaz and Kathleen Raja (hereinafter referred to as Debtors), by and through its attorney, Arun Gupta, Esq., and moves this Court pursuant to 11 U.S.C. 506(a), and Bankruptcy Rules 3012 and 9014 and state: 1. Debtors converted from Chapter 13 to Chapter 11 bankruptcy on April 7th, 2011 (Petition Date). 2. On Petition Date, debtor(s) owned 6 rental income producing properties (hereinafter referred to as the Properties). These are 7104 Alta Dr, Las Vegas, NV 89145 7613 Aplin Ave, Las Vegas, NV 89145 7708 Alina Ave, Las Vegas, NV 89145 721 Biltmore Dr, Las Vegas, NV 89101 6413 Capricorn Dr, Las Vegas, NV 89108

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8149 Spur Ct. Last Vegas, NV 89145

At the time of filing, all the Properties were subject to second mortgages held by Real Time Resolutions, Inc., Agent for Bank of America (fka Countrywide), (hereinafter RTR) The proofs of claims filed by RTR, and values of the properties are attached hereto as exhibits A and B.

LEGAL ARGUMENT Section 506(a)(1) of the Bankruptcy Code provides that a Chapter 11 debtor may bifurcate a secured lenders claim into an allowed secured claim and an allowed unsecured claim based upon the actual value of the property securing such lenders lien. An allowed claim of a creditor secured by a lien on property in which the estate has an interest, or that is subject to set off under section 553 of this title, is a secured claim to the extent of the value of such creditors interest in the estates interest in such property, or to the extent of the amount subject to set off, as the case may be, and is an unsecured claim to the extent that the value of such creditors interest or the amount so subject to set off is less than the amount of such allowed claim. Such value shall be determined in light of the purpose of the valuation and of the proposed disposition or use of such property, and in conjunction with any hearing on such disposition or use or on a plan affecting such creditors interest. 11 U.S.C. 506(a)(1). The Supreme Court has recognized that section 506 of the Bankruptcy Code defines the amount of the secured creditor's allowed secured claim and the conditions of his receiving post-petition interest. United Sav. Ass'n of Texas v. Timbers of Inwood Forest Associates, Ltd., 484 U.S. 365, 371 (1988). In United Sav. Ass'n of Texas, the Supreme Court interpreting Section 506(a) of the Bankruptcy Code found that: In subsection (a) of this provision the creditors interest in property obviously means his security interest without taking account of his right to immediate possession of the collateral on default. If the latter were included, the value of such creditor's interest would increase, and the proportions of the claim that are secured and unsecured would alter, as the stay continues-since the value of the entitlement to use the collateral from the date of

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bankruptcy would rise with the passage of time. No one suggests this was intended. The phrase value of such creditors interest in 506(a) means the value of the collateral. See id. (emphasis added) (quoting H.R.Rep. No. 95-595, pp. 181, 356 (1977)). The Ninth Circuit agrees with this interpretation of section 506 of the Bankruptcy Code. In re Maldonado, 46 B.R. 497, 499 (9th Cir. BAP 1984) (interpreting section 506(a), a claim is a secured claim to the extent of the value of [the] creditors interests in the estates interest in the property. The entire claim is not a secured claim. The claim is secured only to the extent of the value of the secured interest.)

In addition, this Bankruptcy Court has found that an allowed secured claim is a determination generally made under 11 U.S.C. 506. In re BBT, 11 B.R. 224, 229 (Bankr. D. Nev. 1981). The Bankruptcy Court further stated that, with respect to a claim secured by a lien on property of the estate, to the extent that the value of the property is less than the amount of the total allowed claim, the claim is unsecured. Id. (emphasis added). Thus, pursuant to the law of this Circuit, the amount of the allowed secured claim cannot exceed the market value of the property and the remainder of the claim must be treated as an allowed unsecured claim for purposes of the plan. In re Sagewood Manor Associates Ltd. Partnership, 223 B.R. 756, 773 (Bankr. D. Nev. 1998) (holding that the court may confirm a chapter 11 plan over the objection of a class of secured claims if the members of that class are to receive under the plan property of a value equal to the allowed amount of their secured claims, as determined under 11 U.S.C. 506(a)). Moreover, the Ninth Circuit Court of Appeals has also found that a wholly unsecured lien holder's claim can be modified and reclassified as a general unsecured claim pursuant to section 506(a) of the Bankruptcy Code. See In re Zimmer, 313 F.3d 1220 (9th Cir. 2002). Specifically, the Court held: Section 506(a) divides creditors' claims into 'secured claims' and 'unsecured claims.' Although the conventional interpretation of 'secured' might include any claim in which the creditor has a

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security interest in the debtor's property, 506(a) makes clear that the status of a claim depends on the valuation of the property: 'An allowed claim of a creditor secured by a lien on property in which the estate has an interest ... is a secured claim to the extent of the value of such creditor's interest in the estate's interest in such property ... and is an unsecured claim to the extent that the value of such creditors interest ... is less than the amount of such allowed claim.' 11 U.S.C. 506(a). To put it more simply, a claim such as a mortgage is not a 'secured claim' to the extent that it exceeds the value of the property that secures it. Under the Bankruptcy Code secured claim is thus a term of art not every claim that is secured by a lien on property will be considered a secured claim. Here, it is plain that PSB Lending's claim for the repayment of its loan is an unsecured claim, because its deed of trust is junior to the first deed of trust, and the value of the loan secured by the first deed of trust is greater than the value of the house. In re Zimmer, 313 F.3d at 1222 23. Accordingly, because the second mortgages on the Properties are wholly unsecured (in that there is no equity above the first mortgage in the Properties), the lenders claims should be classified as unsecured claims and be treated pro rata with similar unsecured creditors.

13 The second mortgage lender should also be stripped of their secured rights under state law 14 since no maintainable security interest in the subject Property exists. 15 12. 16 requested herein is appropriate in this Court. See In re Bonsignori, Case No. 17 BKS-08-11830-LBR (D. Nev. June 25, 2008) (approving the stripping off of an unsecured 18 lien by motion); see also In re Robert, 313 B.R. 545 (Bankr. N.D.N.Y. 2004); In re 19 Bennett, 312 B.R. 843 (Bankr. W.D. Ky. 2004); In re King, 290 B.R. 641 (Bankr. C.D. Ill. 20 2003); In re Millspaugh, 302 B.R. 90 (Bankr. D. Idaho 2003); Dickey v. Ben. Fin. (In re 21 Dickey), 293 B.R. 360 (Bankr. M.D. Pa. 2003); In re Hill, 304 B.R. 800 (Bankr. S.D. Ohio 22 2003); In re Sadala, 294 B.R. 180 (Bankr. M.D. Fla. 2003); In re Fisher, 289 B.R. 544 23 (Bankr. W.D.N.Y. 2003); In re Hoskins, 262 B.R. 693 (Bankr. E.D. Mich. 2001); In re 24 Fuller, 255 B.R. 300 (Bankr. W.D. Mich. 2000); and In re Williams, 166 B.R. 615 (Bankr. 25 E.D. Va. 1994). 26 27 28 Finally, the filing of a motion rather than an adversary proceeding to achieve the relief

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CONCLUSION According to Bankruptcy law, absent sufficient equity in the Property, the second

3 mortgage lender is wholly unsecured and should receive only their pro rata distribution with other 4 general unsecured creditors through the Debtors Chapter 11 plan. 5 6 7 1. 8 9 2. 10 11 12 3. 13 14 15 4. 16 17 Dated: July 1st, 2011 18 /s/ Arun Gupta, Esq. 19 Arun Gupta, Esq. Attorney for Debtor(s) 20 21 22 23 24 25 26 27 28 WHEREFORE, Debtor prays that this Court: Find that the second mortgage claims of Real Time Resolutions, Inc (Agent for BAC (Fka Countrywide)) hold no liens on the Properties. Immediately avoid or strip off, cancel and extinguish Real Time Resolutions, Inc (Agent for BAC (Fka Countrywide))s liens from the Properties pursuant to 11.U.S.C. Section 506(a); Reclassify Real Time Resolutions, Inc (Agent for BAC (Fka Countrywide))s second mortgage claims as general unsecured claims to be paid pro rata with other general unsecured creditors through the debtors plan; Such other relief the Court finds appropriate.

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1 ARUN GUPTA, ESQ. Nevada Bar No.: 11387 2 GUPTA LAW FIRM, LLC 800 N. Rainbow, #208 3 Las Vegas, Nevada 89107 (702) 493 1059 4 Fax (702) 543 3937 attorney@theguptalawfirm.com 5 Attorney for Debtor 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Debtors In Re: Fayyaz M. Raja Kathleen A. Raja Case No. 10-28885-LBR Chapter 11 Hearing Date: 08/03/2011 Hearing Time: 1:30 pm IN THE UNITED STATES BANKRUPTCY COURT District of Nevada

Notice of Hearing on Motion To Value Collateral, "Strip Off", and Modify Rights of Real Time Resolutions, Inc. Agent for Bank of America (fka Countrywide) NOTICE IS HEREBY GIVEN that a Motion to Value Collateral, Strip Off and Modify Rights of Real Time Resolutions, Inc. Agent for Bank of America (fka Countrywide) has been filed by the Debtor. The hearing on this motion will be held before a United States Bankruptcy Judge at the Foley Federal Building and U.S. Courthouse, 300 Las Vegas Blvd., South, Third Floor, Las Vegas, NV 89101 on above mentioned date and time. Any opposition must be filed pursuant to Local Rule 9014(d)(1). If you do not want the court to grant the relief sought in the Motion, then you must file an opposition with the court, and serve a copy on the person making the Motion no later than 14 days preceding the hearing date for the motion, unless an exception applies (see Local rule 9014(d)(3)). The opposition must state your position, set forth all relevant facts and legal authority, and be supported by affidavits or declarations that conform to Local Rule 9014(c).

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If you object to the relief requested, you must file a WRITTEN response to this pleading with the court. You must also serve your written response on the person who sent you this notice. If you do not file a written response with the court, or if you do not serve your written response on the person who sent you this notice, then: The court may refuse to allow you to speak at the scheduled hearing; and The court may rule against you without formally calling the matter at the hearing.

Dated: July 1, 2011

Signed: _/s/ Arun Gupta___ Arun Gupta Attorney for Debtor

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1 2 3 4 5 6 7 8 9 ARUN GUPTA, ESQ. 10 Nevada Bar No.: 11387 GUPTA LAW FIRM, LLC 11 800 N. Rainbow, #208 Las Vegas, Nevada 89107 12 (702) 493 1059 Fax (702) 543 3937 13 attorney@theguptalawfirm.com 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 ORDERED that the Motion is GRANTED; IT IS FURTHER ORDERED that Real Time Resolutions, Inc. Agent for Bank of Debtors In Re: Fayyaz M. Raja Kathleen A. Raja Case No. 10-28885-LBR Chapter 11 Hearing Date: 08/03/2011 Hearing Time: 1:30 pm IN THE UNITED STATES BANKRUPTCY COURT District of Nevada

Order Re: Motion To Value Collateral, "Strip Off", and Modify Rights of Real Time Resolutions, Inc. Agent for Bank of America (fka Countrywide) This matter having come on for hearing on the above mentioned date and time, attorney for Debtor appearing on behalf of Debtors, proper notice having been given. It is hereby

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America (fka Countrywide)'s second mortgage claims on the 6 properties are Stripped off and shall be avoided pursuant 11 U.S.C. Section 506(a). These properties are 7104 Alta Dr, Las Vegas, NV 89145 7613 Aplin Ave, Las Vegas, NV 89145 7708 Alina Ave, Las Vegas, NV 89145 721 Biltmore Dr, Las Vegas, NV 89101 6413 Capricorn Dr, Las Vegas, NV 89108 8149 Spur Ct. Last Vegas, NV 89145 IT IS FURTHER ORDERED that the above Creditors claims be reclassified as general unsecured claims to be paid pro rata with other general unsecured creditors through the Debtor's Chapter 11 plan; IT IS FURTHER ORDERED that the above Creditor shall retain their respective liens on the real properties described herein until such time as the debtor has completed his Chapter 11 Plan and received a discharge of his obligations; IT IS FURTHER ORDERED THAT in the event the instant Chapter 11 matter is dismissed or converted to another Chapter, the instant order will be vacated.

16 DATED this 1st day of July 2011. 17 18 Submitted by: /s/ ARUN GUPTA 19 ARUN GUPTA, ESQ. 20 800 N. Rainbow Blvd, #208 Las Vegas, Nevada 89107 21 Attorney for Debtors 22 23 24 25 26 27 28

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1 2 3 ___ The court has waived the requirement set forth in LR 9021(b)(1). 4 ___ No party appeared at the hearing or filed an objection to the motion. 5 ___ I have delivered a copy of this proposed order to all counsel who appeared at the hearing, and 6 each has approved or disapproved the order, or failed to respond, as indicated below [list each party and whether the party has approved, disapproved, or failed to respond to the document]: 7 8 ___ I certify that this is a case under chapter 7 or 13, that I have served a copy of this order with the motion purusuant to LR 9014(g), and that no party has objected to the form or content of the 9 order. 10 ### 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 ALTERNATIVE METHOD re: RULE 9021: In accordance with LR 9021, counsel submitting this document certifies that the order accurately reflects the courts ruling and that (check one):