In the recent case of In re Glenn and Henry, WL 4035130 (Bankr. N.D. Okla. 7/1/15/), the bankruptcy court sustained the debtor’s objection to an amended claim filed by their mortgage lender. At the time they filed their Chapter 13 case, the debtors filed a plan which provided for the repayment of $11,400 in pre-petition arrears to their mortgage lender. The mortgage lender never filed a proof of claim. The debtors filed a claim on its behalf with the arrears as listed in their plan. There was no objection to the plan and it was confirmed by the court. After the thirty-second (32nd) month of the plan, the lender filed an amended claim in which it claimed the debtors owed $13,505 in pre-petition arrears. The debtors objected to the lender’s claim.
In sustaining the objection, the court noted at the terms of a confirmed plan are binding upon the debtor and all creditors. Section 1327(a) provides both certainty and finality in every Chapter 13 case. The message to creditors is clear, if you do not like your treatment in the plan, you must file a timely objection. Here, to allow the lender to amend the claim would “stand the Chapter 13 process on its head.” The most important part of the court’s ruling provided that the lender was deemed to have waived the additional arrears. This means that after the case is completed, the debtors would not be obligated to pay the lender the additional $2,105 in arrears.
If you are considering filing for bankruptcy, or are behind in your mortgage payments and facing a foreclosure, you will need an experienced attorney to evaluate your case. The firm of Laura Margulies & Associates, LLC has successfully handled thousands of cases in Maryland and Washington, D.C., many involving unique or novel issues. Please contact us today for a consultation at 301-816-1600. Our website address is: www.law-margulies.com.