NEW: A post-petition payment history must be attached to all Chapter 13 motions for relief in the Northern District of Illinois.
The Northern District of Illinois (Chicago) requires filers to attach a “Statement to Accompany Motions for Relief from Stay” to all motions for relief. The Statement has been revised three times in the last year. The revisions have progressively required more details about payment defaults.
The latest revision (sent to all practitioners on August 19, 2009, and effective immediately) requires a post-petition payment history be attached to the Statement in all Chapter 13 motions for relief. This is not required in Chapter 7 or Chapter 11 cases.
The history must detail the dates of individual payments and the amounts of those payments. This can be satisfied in most cases by attaching a computer record for the period beginning on the date of the filing of the bankruptcy through the date of the referral. If no payments have been made, a payment history is still required.
In addition to including a post-petition payment history for all Chapter 13 cases, all motions for relief (for all chapters) must include the following information: the current balance, the next due date on the account, the amount of arrears, the amount of the regular payments, and the value of the collateral.
The change occurred in part because courts are now heightening their scrutiny of mortgage defaults, but the result is that courts are requiring creditors holding collateral other than real estate, such as vehicles, to make the detailed disclosures as well.
There are ten bankruptcy judges in the Northern District of Illinois (Chicago). Only one of these judges, Judge Schmetterer, has a standing order requiring supporting documents be filed with motions for relief.
Copies of the note and security interest must be filed as exhibits to the motion. If the collateral is real estate, a recorded copy of the mortgage is required. If it is a vehicle, the title is required, and if equipment, the UCC statement must be attached. None of the judges at this point require recorded assignments that show the moving party is the true party in interest, but Judge Schmetterer does require the relationship between the moving party and the original creditor be explained in the motion.
While vehicle titles and UCC statements are rarely challenged, debtor’s attorneys are increasingly asking for recorded documents and assignments or servicing agreements to prove that the moving party is the true party in interest. This trend has been driven somewhat by activist attorneys, but perhaps as much or more so by debtors who have been paying attention to the media and surfing the net on the troubles some mortgage holders may have in proving they are the real party in interest.
It is always the best practice to send your attorney the note and/or security agreement, evidence of security, and any assignments or documents showing a servicing agreement. However, not every loan is equipped with a perfect portfolio of documents. This is a problem only when the court requires them or debtors demand them. In these cases, your WWR attorney will work with you to overcome or satisfy the debtors’ demands.
