A secured creditor whose claim exceeds the value of the collateral may submit a proof of claim and become an unsecured claimant as to the difference.

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This is true according to the Bankruptcy Code, specifically 11 U.S.C. § 506. If the value of the collateral securing a secured claim is less than the amount of the claim, the portion of the claim exceeding the value of the collateral becomes an unsecured claim. The creditor can then submit a proof of claim for the unsecured portion.

A Secured Creditor Whose Claim Exceeds the Value of the Collateral