Motions To Lift Stay When Payments Are Current

03 Sep Motions To Lift Stay When Payments Are Current

You filed bankruptcy to save your home when you got behind on payments. You made all payments due after the bankruptcy was filed and yet your home loan servicer has filed a motion to lift the automatic stay, claiming a default. Bankruptcy lawyers see this problem occur all too often. It is most common in Chapter 13 cases but unwarranted motions can be filed in Chapter 7 cases as well. Proof of payment is provided to the secured creditor and the motion is withdrawn.

This is a nuisance for the court and debtor’s lawyer at best and can result in unwarranted legal fees tacked onto debtor’s home loan balance by an unscrupulous loan servicer.As I have previously discussed, this is often hidden from the debtor until the loan is paid by a refinance or sale, in many cases it is not discovered until long after the bankrupcy case has closed and the debtor has received a discharge. See my earlier article on Protection From Predatory Loan Servicing for information on how this abuse can be prevented.

Court rules in some jurisdictions require a detailed accounting from the servicer to be filed with a lift stay motion. If universally adopted, such a rule could save time and trouble for both the court and debtor, perhaps even the secured creditor.

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I was admitted to practice in 1978. I am certified as a Consumer Bankruptcy Specialist by the American Board of Certification. I regularly speak on tax and bankruptcy issues at state, regional and national conferences. Years of experience in practice before the Internal Revenue Service and Oregon Department of Revenue have given me the background to resolve a large variety of consumer tax issues.
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