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Imperial owned the property until BFP could pay off the amount borrowed. BFP defaulted on loan repayment and Imperial proceeded to sell the property for $433,000 to settle the loan (foreclosure). Before the title of ownership transferred to the buyer, BFP filed for bankruptcy under Chapter 11 of the Bankruptcy Code. BFP asked bankruptcy court to nullify the original foreclosure sale because the home was valued at over $725,000. BFP argued that the low sales price constituted a fraudulent transfer under 11 U.S.C. Section 548(a)(2)(A), which guarantees that debtors receive \u0022reasonably equivalent value\u0022 for property foreclosed. BFP claimed \u0022reasonably equivalent value\u0022 was equal to the market value of the property in question. The bankruptcy court denied BFP\u0027s claim, and a District Court and the U.S. Court of Appeals for the Ninth Circuit affirmed.\u003C\/p\u003E\n","question":"\u003Cp\u003EDoes a property\u0027s fair market value determine whether the amount of debt settled by a foreclosure sale is \u0022reasonably equivalent\u0022 to the property\u0027s worth, as required by U.S.C. Section 548(a)(2)(A)?\u003C\/p\u003E\n","conclusion":"\u003Cp\u003ENo. In an opinion by Justice Antonin Scalia, The Court ruled 5-4 that the value received for a property at a foreclosure sale can be reasonable even if it is different from the \u0022fair market value.\u0022 A foreclosure sale alters market conditions and can lower a property\u0027s selling price. 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