Lenders can be wrong in the amount deemed necessary to cure mortgage arrearages in a Chapter 13 Bankruptcy. I work with my clients to verify, reconcile and dispute discrepancies in my Chapter 13 bankruptcy cases.
Here is an interesting Chapter 13 bankruptcy case wherein it really cost Ocwen https://www.linkedin.com/company/ocwen-financial-corporation for their incorrect numbers. The Debtor had cured the bankruptcy mortgage arrearages.
- December 2009, Debtor filed for bankruptcy after foreclosure proceedings began.
- Chapter 13 Plan included mortgage arrearages payments through the Plan over 42 months.
- October 2011, Debtor received notice from Ocwen stated that Debtor owed $16,000.
- April 2013, Ocwen stated Debtor had a $1,000 credit balance.
- June 2013, Ocwen did not respond to notice that Debtor had made her last payment to cure the bankruptcy mortgage arrearages.
- July 2013, Ocwen sent a letter to Debtor indicating her “severely delinquent mortgage”
- Unfortunately, Ocwen later stated the letters were a mistake.
- Ocwen still insisted payments were delinquent.
- February 2015, Debtor sued Ocwen in Court for Breach of Contract and violations of the Fair Debt Collections Act, Consumer Fraud and Deceptive Business Practices.
- 4 years after Debtor received her Discharge and 2nd day of jury trial, Ocwen found that the Debtor was current.
- Jury awarded Ocwen to pay $582,00 in compensatory damages.
- $3 million in punitive damages for the pain, frustration and emotional torment Ocwen put the Chapter 13 Debtor through.
- Not surprisingly, Ocwen appealed the punitive damages as excessive.
- Ocwen’s conduct was reprehensible but not to an extreme degree.
- Debtor suffered no physical injuries
- Ocwen was indifferent to the debtor’s rights including rights in the Chapter 13 bankruptcy.
- Compared the award to maximum civil penalty of $50,000 under the statute.
- Agreed that Ocwen’s conduct should not equal a penalty of 60x the maximum civil penalty.
- Reduced the punitive damages award to $582,000 considering the mistreatment of Debtor’s $135,000 mortgage.
I find that lenders have been wrong in the amount paid versus amount stated by the lender in Chapter 13 Bankruptcies. https://njbankruptcylawfirms.com/arrogant-lender-pays-250000-in-damages-to-debtor/
Many times, I demand a bank reconciliation. I find that my client’s payments are not properly recorded. As a result, lenders give the matter a thorough review and correct their records.
As with anything, mistakes occur. However, I reconcile lender discrepancies immediately for my clients. You must deal with issues expeditiously.
It is important for a Chapter 13 bankruptcy attorney to work closely with clients and defend their rights. I am here to help you and protect your rights in a Chapter 13 Bankruptcy. Call me with any of your bankruptcies needs: Chapter 7, Chapter 11 or Chapter 13.