Daniel J. Perez and Gina L. Perez

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MEMORANDUM DECISION RE
DEBTORS’ MTN. TO VALUE LIEN 	-1-
UNITED STATES BANKRUPTCY COURT
FOR THE NORTHERN DISTRICT OF CALIFORNIA
In re
DANIEL J. PEREZ, aka DANIEL
PEREZ, and GINA L. PEREZ, aka
GINA PEREZ,
Debtors.
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Case No. 09-31907 SFC
Chapter 13
MEMORANDUM DECISION RE DEBTORS’ MOTION TO VALUE LIEN
On November 5, 2009, the court held a trial on Debtors’ motion
to value lien. 	Howard L. Hibbard appeared for Debtors. 	Douglas
Graham appeared for Joel A. Klein (Creditor). 	Upon due
consideration, and for the reasons stated below, the court
determines the Creditor’s claim is wholly unsecured, and may be
avoided.
Debtors own a single-family residence at 2049 Trinity Street,
San Mateo, California (Debtors’ Residence). 	That property is
subject to two loans secured by deeds of trust. 	The senior note
and deed of trust are held by IndyMac Federal Bank, and Creditor
acknowledges that the balance currently due on that obligation is
Signed and Filed: November 10, 2009
________________________________________
THOMAS E. CARLSON
U.S. Bankruptcy Judge
________________________________________
Entered on Docket
November 13, 2009
GLORIA L. FRANKLIN, CLERK
U.S BANKRUPTCY COURT
NORTHERN DISTRICT OF CALIFORNIA
Case: 09-31907 Doc# 25 Filed: 11/10/09 Entered: 11/13/09 18:05:27 Page 1 of 5

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MEMORANDUM DECISION RE
DEBTORS’ MTN. TO VALUE LIEN 	-2-
$706,950. 	The junior note and deed of trust are held by Creditor,
and the balance due on that obligation is approximately $196,000.
If the fair market value of the Debtors’ Residence is less
than the amount due on the senior deed of trust ($706,950), Debtors
can avoid Creditor’s lien and treat Creditor’s claim as a general
unsecured claim for purposes of Debtors’ chapter 13 plan. 	Zimmer
v. PSB Lending Corp. (In re Zimmer), 313 F.3d 1220, 1226-27 (9th
Cir. 2002).
In determining the value of the Debtors’ Residence, no
deduction should be made for costs of sale, because Debtors’
chapter 13 plan provides that Debtors will retain that property.
I determine that the fair market value of Debtors’ Residence
was less than $706,950 as of the date of the trial. 	In so finding,
I consider the four comparable sales relied upon by both
appraisers, as well as the additional comparable sale noted only by
Debtors’ appraiser (2025 Trinity), and I make and rely upon the
following subsidiary findings of fact.
1. 	Each of the comparable sale properties, except 2025
Trinity, sold for a price in excess of $706,950.
2. 	Each of the comparable sale properties, except 1044
Fiesta, has a smaller gross living area smaller than Debtors’
Residence.
3. 	The average sale price of the five comparable sales was
$711,200. 	In making this calculation, I adjusted the sale price of
2025 Trinity to $490,000 to take account of the lack of commission.
4. 	The gross living area of the Debtors’ Residence is 1,545
square feet. 	The average gross living area of the comparable sale
properties is 1,412 square feet.
Case: 09-31907 Doc# 25 Filed: 11/10/09 Entered: 11/13/09 18:05:27 Page 2 of 5

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MEMORANDUM DECISION RE
DEBTORS’ MTN. TO VALUE LIEN 	-3-
5. 	In light of factors 1-4, the fair market value of Debtors’
Residence could be less than $706,950 only if the condition of the
comparable sale properties was substantially superior to the
condition of Debtors’ Residence.
6. 	Review of the photographs introduced at trial of Debtors’
Residence and of the comparable sale properties indicates that the
condition of the comparable sale properties is in fact
substantially superior to the condition of Debtors’ Residence.
Debtors’ Residence is an attractive house and is adequately
maintained, but is not as attractive as the comparable sale
properties in the following respects: (a) all of the comparable
sale properties have nicer kitchens, and three of those properties
have kitchens that have been substantially upgraded and are much
more attractive than the kitchen in Debtors’ Residence; (b) all of
the comparable sale properties have more attractive landscaping,
and three of those properties have landscaping that is
substantially more attractive than Debtors’ Residence; and (c) in
all of the comparable sale properties the fireplace and flooring is
more attractive than in Debtors’ Residence, and in four of the
comparable sale properties the fireplace and flooring are
substantially more attractive.
7. 	The difference in size between Debtors’ Residence and the
comparable sale properties has a limited effect on fair market
value, because all of the properties have three bedrooms, two
baths, and similar living-dining areas, and it appears from the
photographs introduced at trial that the differences in square
footage do not substantially affect the utility of the rooms.
8. 	The superior condition, remodeling, and attractiveness of
Case: 09-31907 Doc# 25 Filed: 11/10/09 Entered: 11/13/09 18:05:27 Page 3 of 5

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MEMORANDUM DECISION RE
DEBTORS’ MTN. TO VALUE LIEN 	-4-
the comparable sale properties more than offsets the superior size
of Debtors’ Residence and indicates that the fair market value of
the Debtors’ Residence is at least $10,000 less than the average
sale price of the comparable sale properties.
9. 	Neither appraiser made any adjustment to the prices shown
in the comparable sales to take account of the passage of time
between the date of those sales and the date of the trial.
**END OF MEMORANDUM DECISION**
Case: 09-31907 Doc# 25 Filed: 11/10/09 Entered: 11/13/09 18:05:27 Page 4 of 5

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Court Service List
Douglas Graham, Esq.
McNutt Law Group
188 The Embarcadero, Suite 800
San Francisco, CA 94105
Howard L. Hibbard, Esq.
Law Office of Howard L. Hibbard
251 Park Road, Suite 800
Burlingame, CA 94010
Case: 09-31907 Doc# 25 Filed: 11/10/09 Entered: 11/13/09 18:05:27 Page 5 of 5