SUCCESSFULLY CHALLENGING A WRONGFUL DEFAULT CLAIM: CHAPTER 13 VICTORY
Resolving Disputed Defaults and Protecting Debtors' Rights
Defending Homeowners from Unjust Default Claims in Los Angeles & Orange County, CA
Case Overview
In this Chapter 13 bankruptcy case, the debtor had successfully completed all payments under her plan, including direct payments to her mortgage lender. Despite this, the lender wrongfully claimed a $19,700 post-petition default, even while holding over $23,000 in "suspense" funds, leading to a dispute over the validity of the default claim.
Legal Approach
Our legal team conducted in-depth discovery, including securing far-reaching discovery orders to expose the wrongful nature of the lender's claim. We argued that the lender was improperly holding funds that should have been credited toward the debt, effectively invalidating the default claim. Through strategic legal motions and negotiations, we sought to hold the lender accountable.
Outcome
As a result of our efforts, the lender ultimately agreed to credit the $23,000 held in suspense toward the debt, thereby curing the alleged post-petition default. Additionally, the lender was ordered to pay over $49,000 in attorney’s fees and costs, a major victory for our client.
Case Significance
This case highlights the importance of scrutinizing wrongful default claims and enforcing creditor accountability in Chapter 13 bankruptcy proceedings. It underscores the protection available to debtors who face unjust financial demands after fulfilling their obligations.
LEGAL ADVICE YOU CAN TRUST
