Bankruptcy Mastery

Becoming a better bankruptcy lawyer

Mortgage Servicing Under the Microscope

By Filed Under: Real property, Rule 3002.1

Rule 3002.1

The judge looked closely at the creditor's accounting records and found the usual fright. Having looked, the court held secured creditor  USDA in contempt of the automatic stay and the confirmation order for its loan servicing blunders. Two years after the debtor's discharge, after an evidentiary hearing and a written opinion, the debtor still didn't have a full accounting of the … [Continue reading...]

Homeowners Face Down The Mortgage Servicer Over Their Request For Information

By Filed Under: Real property

homeowner v. bank`

  The homeowners beat the bank in the first round of RESPA/FDCPA litigation, upholding the private right of action under Reg. X. The case is Rios v. Rushmore, from the Southern District of Florida. The homeowners alleged that Rushmore Loan Management Services failed to adequately respond to their Notice of Error pursuant to 12 U.S.C. 2605(k)(1)(C).. They sought explanations for … [Continue reading...]

Chronicles of Bankruptcy Rule 3002.1

By Filed Under: Rule 3002.1

on the trail

A homeowner should emerge from Chapter 13 knowing exactly what she owes on her mortgage;  thus we have FRBP 3002.1 said Judge Hannah Blumenstiel. At the end of my client's Chapter 13, the lender's response to the trustee's notice of final cure payment failed to do that.  The failure to adequately support its contentions in its pleading cost the bank. Not as big a hit as I wanted. … [Continue reading...]

Cautionary Tale re Bankruptcy, Attorneys and Notice

By Filed Under: Bankruptcy Practice

bankruptcy notice

How often has your bankruptcy client presented you with a copy of a complaint or an abstract of judgment for inclusion in their list of creditors? On the face of the pleading, you have the name and mailing address of the creditor's lawyer. But is that good enough for a bankruptcy discharge? A recent case from the 9th Circuit has caused me to reconsider. Notice to former lawyer … [Continue reading...]

Who Wants To Get Paid?

By Filed Under: Attorneys fees

getting paid

Anyone interested in attorneys fees? Are you filing adversaries and motions to collect money from creditors and other miscreants? Then it's worth looking at two snippets about attorneys fees that have floated across my radar screen. FRCP 54 One of the participants at the Litigating on a Shoe String roundtable at the NACBA convention pointed out the deadline in Rule 54 to request … [Continue reading...]

Untangling The Converted Bankruptcy Case

By Filed Under: Bankruptcy Practice, Chapter 13, Counseling clients

Conversion to Chapter 7 from Chapter 13 usually comes amid some sort of train wreck. The debtor has defaulted on plan payments, decided to surrender the house, or even got a loan modification that allows him to keep the house. Often, there is pressure to convert the case before it is dismissed. In the bustle, don't forget to counsel the debtor on the differences between 13 and 7. Big … [Continue reading...]

Bankruptcy & Divorce: A Disruption In The Force

By Filed Under: Family Law in Bankruptcy

family law bankruptcy collide

When bankruptcy law and family law intersect, the result can be liberating or disruptive, depending on the timing of a bankruptcy filing and the goals of  the parties. An infinite number of combinations lead to infinite different outcomes. The variables start with whether bankruptcy occurs before or after status is altered; before or after the division of the property; the choice of … [Continue reading...]

Unfair Loan Modification Practices Rejected By 9th Circuit

By Filed Under: Bankruptcy Practice, Cases new & significant, Real property

bank lies

  Promising a loan modification and failing to deliver, after pocketing trial mod payments, isn't fair, said the 9th Circuit in Oskoui. And if it isn't fair, it can be actionable under California's Unfair Competition Law (B&P 17200). Not to mention constituting a breach of contract. Thus, there do seem to be some limits on the shenanigans a lender or mortgage servicer can engage … [Continue reading...]

Shadow Players May Have Support Claims In Bankruptcy

By Filed Under: Family Law in Bankruptcy

divorce fees

What we know so far about domestic support obligations in bankruptcy is that they are non dischargeable and the bankruptcy court has the last word as to what is and is not support. But we just scratched the surface in looking at support when we considered obligations from one spouse to another. Debts owed to an extended cast of supporting characters may be "support" as well, non … [Continue reading...]

Getting Means Test Tax Projections Right

By Filed Under: Means test, Tax

The means test tax deduction offers fertile ground for passing the means test. But mention tax calculations to a bankruptcy attorney and 7 out of 10 freeze on the spot. I'm not a tax attorney, they retort. That's right, but, if you are a bankruptcy attorney, that doesn't relieve you  from knowing enough tax to get the means test right. Not to mention not giving up your client's … [Continue reading...]

When Chapter 13 Debtors Run Amok

By Filed Under: Counseling clients

Chapter 13

We've had a string of them.... [Hint: in a small practice, a "string" means "three. " ] But three clients in the past month with confirmed Chapter 13 plans have contracted to sell their homes without mentioning it to us, their attorneys. The degree of chaos varied:  inadequate time to get approval of the sale from the trustee within the contractual closing date; … [Continue reading...]

How Lien Stripping Differs From Lien Avoidance

By Filed Under: Real property

lien stripping

The draft of a lien avoidance motion my paralegal presented me was garbled.  Lien stripping concepts sat next to a cite to §522. I doubt my staff is alone in missing the critical differences between lien stripping under (or despite) §1322 and lien avoidance pursuant to §522(f). So let's try some compare and contrast on liens we want to excise. Avoid liens that impair … [Continue reading...]