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    Mortgage Modification/Proof of Claim Question

    When a mortgage is modified in a Ch 13, does the the Mortgage Proof of Claim need to be amended/updated to reflect new payments terms, new principal, etc? If the POC needs to be amended (and I assume it needs to be amended), would a Notice of Mortgage Payment Change (Form 410 S1) suffice, or must a new Form 410 (POC form) be filed with the BK Court? Or does some other document need to filed by the lender to reflect the new terms? My impression is that 410 S1 amends the mortgage POC, but want to confirm if that is correct or not.
    Filed Ch 13 November 2013, discharged March 2019

    #2
    If you're in a Chapter 13, the Trustee will pay exactly what's on the claim. (There is a small exception for mortgages that have variable rates and the Trustee is allowed to pay the "ARM" adjustment without need to have a hearing on the adjustment.). If you are doing a modification I would certainly move the court for a modification of the confirmed order. Work with the Trustee so that the modification is agreed and that there will be no hearing.

    I guess I'm saying is that the Plan controls once it is confirmed. You would modify the Plan. If the creditor wants to modify the claim because they are reducing principal, then I would have them modify the claim as well.

    It's really a CYA thing.
    Chapter 7 (No Asset/Non-Consumer) Filed (Pro Se) 7/08 (converted from Chapter 13 - 2/10)
    Status: (Auto) Discharged and Closed! 5/10
    Visit My BKForum Blog: justbroke's Blog


    I am not an attorney. Any advice provided is not legal advice.

    Comment


      #3
      The mortgage modification has been approved by the court. It was a reduction in payment and interest, no reduction in principal. The next step is to modify the plan. It appears that my attorney wants the lender to submit a new POC before filing a new plan but the lender hasn't responded, though we could maned the claim ourselves.. I was curious if the 410 S1 would have been all that's required (with the signed mortgage mod agreement attached.
      Filed Ch 13 November 2013, discharged March 2019

      Comment


        #4
        The "Notice of Mortgage Payment Change" form is typically used for "adjustable rate mortgages" (ARMs) when they adjust. This is to avoid the more costly (a relative term) motion practice in order to modify a confirmed plan.
        Chapter 7 (No Asset/Non-Consumer) Filed (Pro Se) 7/08 (converted from Chapter 13 - 2/10)
        Status: (Auto) Discharged and Closed! 5/10
        Visit My BKForum Blog: justbroke's Blog


        I am not an attorney. Any advice provided is not legal advice.

        Comment


          #5
          Thanks!
          Filed Ch 13 November 2013, discharged March 2019

          Comment


            #6
            That form even reads that the form should be a "supplement to your proof of claim at least 21 days before the new payment amount is due." It goes on to read that if it's a loan modification (#4) the change may require court approval. My reading is that a new claim should be filed along with this form especially if it's due to a loan modification.

            While it is almost inevitable, mortgage balance, payments, escrow shortage, suspense account, and other issues are things that you want to mitigate during a Chapter 13. It seems that there are always problem when the case is discharged and the accounting was imperfectly kept (or is that ineptly kept).
            Chapter 7 (No Asset/Non-Consumer) Filed (Pro Se) 7/08 (converted from Chapter 13 - 2/10)
            Status: (Auto) Discharged and Closed! 5/10
            Visit My BKForum Blog: justbroke's Blog


            I am not an attorney. Any advice provided is not legal advice.

            Comment

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