Notable Case - Recent Decision In Re: Mayberry

Notable Case – Recent Decision In Re: Mayberry

In 2011 a client came to me to help save her home from foreclosure. This client has limited income and was struggling to survive. A chapter 13 bankruptcy reorganization was filed, which immediately stopped the pending foreclosure.

The reorganization plan proposed for the debtor to make mortgage payments at a reduced rate of $600 while the debtor worked with the lender on a home loan modification.

For 12 months the debtor did what she was supposed. She made all her payments and the mortgage lender did not object. Then the bankruptcy trustee filed a motion to dismiss the case because, she alleged, that it was unfair to the lender that they were not being paid their past due payments.

The bankruptcy judge heard arguments on this matter in the summer of 2012 and in January 2013 ruled on the matter.

The judge was not convinced by the trustee's arguments and in a 6 page written decision denied the trustee's motion.

For the debtor this means she can continue to live in her home while under the protection of the bankruptcy court.