Matthews v. Transamerica Financial Services

This is an appeal by debtors who wish to avoid a security interest in household goods under Bankruptcy Code section 522(f). 11 U.S.C. § 522(f) (Supp. V 1981). Under this section, debtors can avoid non-purchase money security interests in household goods. The debtors in this case argue that the purchase money character of the lender’s security interest in the goods was lost in a refinancing in which the debtor received additional funds. The Bankruptcy Judge adopted this position. The Bankruptcy Appellate Panel reversed. In re Matthews, 20 B.R. 654 (Bkrtcy. 9th Cir.1982). We reverse the…