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Bankruptcy Proof of Claim

The form the creditor files in bankruptcy court to assert the mortgage debt — and what to check when the creditor gets it wrong.

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Bankruptcy & Post-Sale

A Bankruptcy Proof of Claim (Official Form B410) is the form a creditor files in a bankruptcy case to assert its claim against the debtor for a specific debt amount. In a bankruptcy (Chapter 7, 11, 12, or 13), every creditor that wants to be paid must file a Proof of Claim. For a mortgage, the Proof of Claim must include: (1) the amount owed as of the petition date, broken down by principal, interest, fees, and arrears, (2) evidence of the debt (the Note, Mortgage, assignments, payment history), (3) evidence of perfected security interest (recorded Mortgage and assignments), (4) an itemized statement of pre-petition fees, expenses, and charges, and (5) if the claim includes escrow amounts, an escrow analysis. Under Bankruptcy Rule 3001, a Proof of Claim that includes improper fees, lacks documentation, misstates the amount, or fails to account for payments may be challenged (Objection to Claim) and potentially disallowed or reduced.

Purpose

  • 1Assert the creditor's claim for the mortgage debt in bankruptcy court
  • 2Document the amount owed as of the bankruptcy petition date
  • 3Provide evidence of the debt and security interest
  • 4Enable the creditor to participate in the bankruptcy distribution (Chapter 7) or plan payments (Chapter 13)

Who Prepares It

The creditor (or the creditor's bankruptcy attorney) prepares the Proof of Claim — Official Form B410. Filed with the bankruptcy court and served on the debtor and the debtor's attorney.

When It Is Used

Filed after the bankruptcy petition in Chapter 7, 11, 12, or 13. Deadline: 70 days after the petition date (in most cases). Late-filed proofs of claim may be disallowed.

Legal Effect

A properly filed Proof of Claim is prima facie evidence of the validity and amount of the claim (Bankruptcy Rule 3001(f)). The debtor can object to the claim (Objection to Proof of Claim) on grounds such as: overstated amount (improper fees, incorrect arrears calculation, payment misapplication), lack of standing (claimant does not own the debt), insufficient documentation, or violation of applicable law (RESPA, FDCPA, state law). If the debtor does not object, the claim is allowed as filed.

Common Mistakes

Not reviewing the Proof of Claim carefully — servicers frequently inflate claims with improper fees (attorney fees, inspection fees, BPO costs) that are NOT allowed in bankruptcy
Not objecting to an inflated claim — if you don't object, the inflated amount becomes the allowed claim and you must pay it in a Chapter 13 plan
Not checking the Proof of Claim's supporting documentation — missing assignments, lack of standing, and improper fees are all grounds for objection

Homeowner Rights

Right to receive a copy of every Proof of Claim filed against you
Right to object to any Proof of Claim (deadline: 30 days after the claims bar date for Chapter 13; no strict deadline in Chapter 7 unless a distribution is pending)
Right to examine the supporting documentation and challenge its sufficiency
Right to seek disallowance or reduction of an improper Proof of Claim

Frequently Asked Questions

What happens if the creditor doesn't file a Proof of Claim?

In Chapter 13: the creditor cannot participate in your plan (receive plan payments). In Chapter 7: in a no-asset case (no distribution to creditors), the creditor may not file a claim — the debt is discharged anyway. In a Chapter 7 asset case: the creditor must file a timely Proof of Claim to receive a distribution; late claims are subordinated or disallowed. However, failure to file a Proof of Claim does NOT necessarily mean the debt is extinguished — the lien survives the bankruptcy unless stripped or avoided.

How do I object to a Proof of Claim?

File an Objection to Proof of Claim with the bankruptcy court, serve it on the creditor and the trustee, and set a hearing. Grounds for objection include: incorrect amount (improper fees, miscalculation), lack of standing (the claimant cannot prove it owns the debt), insufficient documentation (missing Note, assignments, or payment history), or violations of law. You typically have 30 days after the claims bar date to object. The objection should include specific facts and legal arguments.

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