A trend among debtor attorneys has emerged that could significantly affect the rights of mortgage lenders and servicers of home mortgages.  Recently, attorneys have begun objecting to Proof of Claims filed by lenders and servicers when the claim is not amended immediately after a loan modification. Instead of Responding to said Objection, some creditors mistakenly believe that having the proof of claim amended is enough to quash the Objection.  However, a Response must be filed, prior to any set Response Deadline or, if no Response Deadline has been set, the hearing must be attended.  What is the risk? A failure to respond to these Objections could result in an order being entered Disallowing the Proof of Claim. Should this occur, the creditor will likely have to disgorge any amounts that had been disbursed by the Trustee and applied to the loan prior to the modification.

We have also come across many cases where the debtor attorney has objected to a Notice of Payment Change ("NPC") or a Notice of Fees, Expenses, and Charges ("PPFN") under rule 3002.1. The NPC objections stem from debtor attorneys looking very closely at the escrow analysis. More and more attorneys are dissecting these analyses to determine if the projected escrow is correct and digging into why there are shortage amounts.  Even a simple shortage of less than $50 per month has been raising Objections. Often times, the shortage has accrued over more than just the last twelve months due to either a lack of analysis run in prior years or a failure by the servicer to have calculated an earlier shortage into an earlier payment change amount. The next type of Objection relates to the 21 day NPC time frame as we are now seeing Chapter 13 Trustees object to late filed NPCs in some states and districts. We have concerns that this trend may catch on.

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"Manufactured" or "Mobile" homes continue to be a thorn in the side of the real estate industry. While there is certainly not enough room in this space for me to navigate you through all of the perils of curing titles to mobile homes affixed to real estate, I hope that I can at least steer you in the right direction.

When a mobile home is fabricated at an "off-site" facility and transported to a mobile home dealership, the home is delivered with a Manufacturer's Statement of Origin ("MSO"). This is the first "title" to the home, and the home is deemed to be personal property. When the home is sold, the dealer endorses the MSO over to the purchaser who can either surrender the MSO to the State, or have the State register the home and issue a Certificate of Title ("COT"). The home is then transported to a piece of real estate and permanently affixed thereto. However, the mere act of permanently affixing the home to the land (including the recording of an Affidavit in the land records memorializing same), does not, in and of itself, void the MSO or COT and convert the home to real estate. Instead, the MSO or COT must be surrendered to the State DMV for "cancellation"/"De-Titling". Thus, whether a mobile home is permanently affixed to real estate is just one part of the analysis. The ultimate goal is to ensure that the mobile home title records are purged. So how do we get there?

When our firm receives a mobile home curative referral, we must perform a search of the "DMV" records to determine if the home was ever titled with the State. The results of this search determine the appropriate course of curative. For example, often, the DMV search shows that the mobile home is still titled in the name of a prior owner in the chain of title to the land. When faced with these facts, one curative option is to attempt to locate the prior owner, and have the owner execute applicable State specific mobile home documents. If successful, our client can then apply for a new mobile home title in its name, and then surrender same to the State. But what happens if the prior owner is deceased or is currently in Bankruptcy?

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