Objection to Proof of Claim
Challenge a creditor's claim in bankruptcy court — particularly powerful when mortgage servicers file inflated, inaccurate, or unsubstantiated claims.
Overview
An Objection to Proof of Claim is a formal challenge filed in bankruptcy court disputing a creditor's claim — the amount owed, the priority of the claim, the creditor's right to payment, or the sufficiency of the documentation supporting the claim. In mortgage bankruptcy cases, Proof of Claim objections are particularly important because servicers frequently file claims with inflated fees, incorrect arrears calculations, improperly documented assignments, or fees not authorized by the mortgage contract or applicable law. A successful objection can reduce the amount you must pay through your Chapter 13 plan, remove improper fees, and expose servicer misconduct that supports other legal claims.
Purpose
- •Reduce the amount the servicer claims is owed by challenging improper or inflated charges
- •Force the servicer to produce documentation supporting every dollar claimed
- •Challenge the servicer's standing to file a claim if assignments are defective
- •Remove unauthorized fees (attorney fees, inspection fees, BPO fees) from the claim amount
- •Create leverage for a more favorable loan modification or settlement
When to File
File within 60 days after the meeting of creditors (FRBP 3007). In Chapter 13, objections to claims that affect plan confirmation should be filed before or at the confirmation hearing. Late objections may be permitted for cause.
Timeline
Objection deadline: 60 days after the 341 meeting (Chapter 13: 60 days after the first date set for the 341 meeting). The court schedules a hearing (typically 30-60 days after filing). If the objection is sustained, the claim is reduced or disallowed. An amended claim can be filed, which can be objected to again.
Key Elements & Requirements
Identification of the specific claim being objected to (claim number, creditor, amount)
Specific grounds for objection: Incorrect amount, improper fees, insufficient documentation, lack of standing
Legal basis: Cite applicable bankruptcy rules (FRBP 3007), Bankruptcy Code sections, and non-bankruptcy law
Evidence: Attach documentation supporting the objection — payment records, mortgage statements, expert analysis
Notice of hearing: Schedule a hearing on the objection
Proposed order: Draft order sustaining the objection and modifying or disallowing the claim
Legal Standard
A properly filed Proof of Claim is prima facie evidence of the validity and amount of the claim (FRBP 3001(f)). The objecting party bears the initial burden of producing evidence to rebut the presumption. Once rebutted, the burden shifts to the creditor to prove the validity and amount of its claim by a preponderance of the evidence. If the creditor cannot meet this burden, the claim may be reduced or disallowed.
Strategy & Tips
Obtain a complete copy of the Proof of Claim (including all attachments) from the bankruptcy court or PACER. Scrutinize every line item: compare the arrears claimed to your records, check every fee against the mortgage contract and state law, and verify the chain of assignments. A forensic loan audit is ideal preparation for a claim objection. Common issues: fees charged after bankruptcy filing (violation of automatic stay), attorney fees without fee application, inspection fees without evidence inspections occurred, and corporate advances without supporting documentation.
Court Filing Information
Where to File
U.S. Bankruptcy Court where the case is pending.
Fees
No separate filing fee for claim objections.
Format
Standard bankruptcy motion format with notice of hearing.
Copies Required
Original to court + copy to the creditor (and its attorney) + trustee + your copy.
Frequently Asked Questions
What happens if I don't object to a Proof of Claim?+
If you don't object, the claim is deemed allowed in the amount stated (subject to the court's review). In Chapter 13, you will be required to pay the full allowed claim amount through your plan. Inflated claims mean higher plan payments. If you believe a claim is incorrect, you MUST object — failing to object is treated as acceptance of the claim amount.
Can I object to a Proof of Claim after the deadline?+
Yes, but you need 'cause' for a late objection. Cause may include newly discovered evidence of fraud, recently obtained documentation showing the claim is inflated, or change in law. The court has discretion to consider late objections. However, object before the deadline whenever possible — late objections are disfavored.
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