23 Feb Kansas Judges End Secret Mortgage Fees in Chapter 13 Bankruptcy
Kansas judges are stopping secret fees being added to the home mortgage accounts of chapter 13 bankruptcy debtors. Creditors are being required to disclose their fees in documents filed with the Court. Debtors will have the opportunity to object to bogus fees and have the Court determine what fees are allowed.
A new chapter 13 form confirmation order was been approved this week by all the Kansas bankruptcy judges that contains the following language:
No real estate creditor shall ever assess, charge or collect, from either the debtor or the real estate collateral, any assessments, fees, costs, expenses or any other monetary amounts, exclusive of principal, interest, taxes and insurance, that arose from the date of the filing of the bankruptcy petition to the entry of the Order of Discharge except as may be allowed by court order or an allowed proof of claim.
The new rule should end the practice of adding undisclosed and unapproved fees to the loan after the bankruptcy case is over and presenting a bill to the debtor when he does to refinance or sell his home. Read more about this abusive practice in Jonathan Ginsberg’s post on this network and in Michael Doan’s post on the Bankruptcy Law Network.
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