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application (1994 loan application). The purpose of that loan as
stated in that loan application was boat repair. The 1994 loan
application indicated, inter alia, that the Quissett was to
secure5 the 1994 loan and that the value of the Quissett was
$170,000. Petitioners’ loan balance with Credit Union before
they received the 1994 loan was $89,195.63, and their loan
balance with Credit Union after they received that loan was
$104,195.63.
Foreclosure With Respect to Credit
Union Loan Secured by the Quissett
On November 12, 1996, petitioners filed a petition for
bankruptcy (bankruptcy petition) under Chapter 7 of title 11 of
the United States Code with the United States Bankruptcy Court
for the Western District of Washington (bankruptcy court).
Petitioners’ bankruptcy petition included a document entitled
“SUMMARY OF SCHEDULES”, to which was attached, inter alia,
“SCHEDULE B-–PERSONAL PROPERTY” (bankruptcy Schedule B) and
“SCHEDULE D--CREDITORS HOLDING SECURED CLAIMS” (bankruptcy
Schedule D).
In bankruptcy Schedule B, petitioners listed the Quissett
among their personal property and claimed that it had a fair
market value of $84,000.
5The terms of the security agreement that petitioners en-
tered into by signing the 1994 loan application were on the
reverse side of that document. The record does not contain a
copy of the reverse side of the 1994 loan application and the
terms of that security agreement.
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