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Informal Proof of Claim Allowed by Connecticut Bankruptcy Court

Posted By USFN, Tuesday, May 23, 2017
Updated: Thursday, May 18, 2017

May 23, 2017

by Randall S. McHugh
Bendett & McHugh, P.C. — USFN Member (Connecticut, Maine, Vermont)

What do you do when the proof of claim bar date is approaching and you are not ready to file an official proof of claim? File an informal proof of claim (POC).

Unlike Bankruptcy Official Form 410, an informal proof of claim does not need to comply with all the requirements of Federal Rule of Bankruptcy Procedure 3001. An official POC secured by property that is the individual debtor’s principal residence requires the claimant to itemize its claim, attach the writing evidencing the claim, attach evidence of a perfected security interest, attach Official Form 410A setting forth a loan payment history from the first date of default1, and attach an escrow analysis performed as of the date of the bankruptcy filing. A pleading can constitute an informal POC while only setting forth the estimated amount of the claim and the estimated amount of the arrears. The facts of a recent case are illustrative of this point.

Bankruptcy Court Decision
In Deutsche Bank National Trust Company, as Trustee for Fremont Home Loan Trust 2006-2, Asset-Backed Certificates, Series 2006-2 v. Cintron, Case Number 16-20109, 2017 WL 521502 (Bankr. D. Conn. Feb. 8, 2017), the proof of claim bar date was June 9, 2016. The debtor’s plan included payment of a pre-petition arrearage to the secured creditor in the amount of $43,000. On February 1, 2016 the secured creditor filed an objection to the plan and asserted an estimated pre-petition arrearage of $48,182.19 and an estimated total debt of $205,357.55, plus stated its intention to file its proof of claim before the bar date. However, the bar date passed without a formal POC being filed. Thereafter, the chapter 13 trustee filed a POC on behalf of the secured creditor asserting a total pre-petition arrearage of $43,000. Subsequently, the secured creditor filed its official POC on September 27, 2016, claiming a pre-petition arrearage of $49,057.88 and a total secured claim of $205,404.42.

The bankruptcy court ultimately determined that the objection to confirmation that was filed before the bar date constituted an informal proof of claim, and the creditor was allowed to amend said informal proof of claim through the filing of a post-bar date official POC that set forth the actual pre-petition arrears and total debt owed. In reaching its conclusion, the court applied the following four-part test, which it adopted from other courts in the Second Circuit.

The court held that in order to be considered an informal proof of claim, the following must be true: “The document must (1) be timely filed with the bankruptcy court and become part of the judicial record; (2) state the existence and nature of the debt; (3) state the amount of the claim against the estate; and (4) evidence the creditor’s intent to hold the debtor liable with the debt.”

The Cintron case is a big victory for mortgage servicers and investors. With the proposed rule change (which will shorten the POC bar date considerably), whenever the bar date is likely to be missed, consideration should be given to filing pleadings that constitute an informal proof of claim when possible — assuming that it is not prohibited in the applicable jurisdiction.


1The “first date of default” is defined as the first date on which the borrower failed to make a payment in accordance with the terms of the note and mortgage, unless the note was subsequently brought current with no principal, interest, fees, escrow payments, or other charges immediately due and payable.

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