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New Chapter 13 Mortgage Modification Mediation Program

Thursday, December 23, 2021

The bankruptcy court is pleased to announce a new Chapter 13 Mortgage Modification Mediation Program. The Program is designed to help qualified Chapter 13 debtors renegotiate their mortgages and keep their homes. The Program supplies an electronic portal that assists communication between debtors and lenders. Details of the Program and sample forms are available here.

The program is entirely voluntary: both debtor and lender must consent to participate. Debtors and lenders are also free to modify mortgage obligations without using the Program and the portal. The Program simply provides a new vehicle for doing so.

Debtors’ counsel who enter into the Court-Approved Retention Agreement and a new Addendum to the CARA (Local Form 13-8.5) and who pursue a mortgage modification through the Program will be presumptively entitled to additional flat fees as compensation.  The Addendum is available here. The court has entered a Second Amended General Order No. 13-01 declaring that additional flat fees can be awarded under the Addendum’s terms. The Second Amended General Order is available here.