Able has an allowed claim of $5,000 against the estate of Wallace and has a security interest in his art collection in the amount of $3,000 of the $5,000 claim.Able:

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Able has a secured claim for $3,000 against the art collection and an unsecured claim for the remaining $2,000. In a bankruptcy proceeding, secured claims are paid first from the assets of the estate, followed by unsecured claims. Able will receive the $3,000 from the sale of the art collection, but may not receive the remaining $2,000 if there are not enough assets in the estate to pay all unsecured claims in full.

Able Has an Allowed Claim of $5,000 Against the Estate