Belarminio Peralta v., 48 F.4th 178

Peralta bought a house via a Pennsylvania land-installment contract (seller retained title; contract secured by a lien).
After defaulting, Recon revised the contract; Peralta breached again and Recon obtained a judgment for possession that, under the revised terms, extinguished Peralta’s rights.
Peralta remained in the home and later filed Chapter 13 bankruptcy, seeking to use 11 U.S.C. § 1322(c)(1) to "cure" the default and preserve his interest.
The bankruptcy court held Peralta could cure and included the house in the bankruptcy estate; the district court vacated that order.
The Third Circuit reviewed whether § 1322(c)(1) applies to Pennsylvania installment contracts and whether Peralta’s cure right survived entry of a judgment for possession.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether §1322(c)(1) (right to cure a default on a residence until it is "sold at a foreclosure sale") applies to Pennsylvania land-installment contracts	Peralta: §1322(c)(1) applies because Pennsylvania treats installment contracts as mortgages/liens, so §1322 can cure the default	Recon: §1322(c)(1) is tied to foreclosure-sales context and should not indefinitely revive non-mortgage installment-contract defaults	Held: §1322(c)(1) can apply to installment contracts because they create liens under Pennsylvania law, so a §1322 remedy exists for such defaults
When the §1322(c)(1) cure window closes for an installment contract	Peralta: His possession of the house after judgment meant he still had an interest and could cure in bankruptcy	Recon: Entry of a judgment for possession is the installment-contract analogue to a foreclosure sale and ends any equitable interest, so §1322 relief is unavailable after judgment	Held: The cure window closed when Recon obtained a judgment for possession; mere continued possession without a good-faith claim does not preserve a §1322 right

In re Connors, 497 F.3d 314 (3d Cir. 2007) (adopts the "gavel rule": property is "sold at a foreclosure sale" when the auction concludes)
Anderson Contracting Co. v. Daugherty, 417 A.2d 1227 (Pa. Super. Ct. 1979) (Pennsylvania treats installment contracts as secured by a lien on real property)
In re Majestic Star Casino, LLC, 716 F.3d 736 (3d Cir. 2013) (bankruptcy filing does not create new property rights where none existed)
Whitman v. American Trucking Ass'ns, 531 U.S. 457 (2001) (statutory interpretation principles; courts should not read large implicit exceptions into text)
In re Atlantic Bus. & Community Corp., 901 F.2d 325 (3d Cir. 1990) (possession with the owner’s permission can constitute a protectable property interest in bankruptcy)
Am. Housing Tr., III v. Jones, 696 A.2d 1181 (Pa. 1997) (defines breach/default in the installment-contract context)