Conduit Payments, Adequate Protection and the new form Chapter 13 Plan
The Bankruptcy Court for the Northern District of Ohio, Eastern Division (Cleveland) has issued three Administrative Orders (09-02, 09-03, and 09-04) which will become effective August 10, 2009. These Administrative Orders will govern mortgage payments, adequate protection payments and the new form Chapter 13 Plan.
• Administrative Order 09-02: Order Governing Conduit Mortgage Payments in Chapter 13 Cases:
In order to improve Chapter 13 completion rates, reduce post-petition mortgage defaults, and provide accurate recordkeeping effective August 10, 2009, Chapter 13 Debtors will be required to make their ongoing mortgage payments through their Chapter 13 Plan rather than directly to the creditor as in the past. Payment changes, servicer changes and other mortgage transactions will now go through the Chapter 13 Plan.
• Administrative Order 09-03: Order Governing Adequate Protection Payments:
Effective August 10, 2009, adequate protection payments, which currently can be made through the Trustee only upon a motion, hearing, and order, will be paid through the Trustee by use of the plan provision which will take effect pre-confirmation. This will eliminate the delay and work needed by the current process.
• Administrative Order 09-04: Order Adopting New Chapter 13 Plan as of August 10, 2009 and Vacating Administrative Order 06-04 as of the same date
