The Ninth Circuit BAP ruled in two cases, In re Martinez and In re Smith,
that Chapter 13 debtors may not take deductions for payments on stripped
mortgages and surrendered property, respectively. They relied heavily
on the “reasonable and necessary” language of 1325(b)(2),
finding that the application of the means test as stated in (b)(3) was
limited by the reasonable and necessary language in (b)(2).
More analysis to come . . .