Important Notice to the Bar and Public Concerning Third Amended General Order Adopting Loss Mitigation Program and Procedures and Revised Local Forms
UNITED STATES BANKRUPTCY COURT
DISTRICT OF NEW JERSEY
Important Notice to the Bar and Public
Concerning Third Amended General Order
Adopting Loss Mitigation Program
and Procedures and Revised Local Forms
EFFECTIVE IMMEDIATELY
Please be advised that pursuant to a Third Amended General Order Adopting Loss Mitigation Program and Procedures (LMP) dated December 17, 2019, the Board of Judges of the United States Bankruptcy Court for the District of New Jersey has approved the following LMP amendments:
Section II. Loss Mitigation Defined - Amendment limits the definition of loss mitigation to loan modification or refinance.
Section III. Eligibility - Amendment removes availability of loss mitigation in Chapter 7 cases in Section III.A. and throughout the LMP. In Section III.B, the definition of real property is no longer limited to a principal residence.
Section V. Commencement of Loss Mitigation – Amendment includes additional service requirements as well as a statement confirming that LMP is no longer available in Chapter 7 cases. In addition, denial of loss mitigation within a specific time period may be grounds for an objection.
Section VI. Loss Mitigation Order – Amendment requires inclusion of specific adequate protection payment to be made in the proposed Loss Mitigation Order in Section VI.A. In Section VI.B.1., the amendment includes the provision that a request or motion for loss mitigation will not be considered as an objection to a motion for relief from stay. In addition, Section VI.B.3 clarifies distributions that may be included in interim confirmation orders.
Section VII. Duties of the Loss Mitigation Parties – Amendment eliminates Section VII.C., which required that a Loss Mitigation Final Report be filed. New Section VII.C. (formerly Section VII.D.) states that court approval is required to enter into any final agreement reached during loss mitigation. Section VII.D. has been eliminated.
Section VIII. Loss Mitigation Process – Amendment allows a party to request permission to exchange documents and communications conventionally if use of the portal would create an undue hardship. Previously, this relief was limited to a request by an attorney.
Section IX. Duration, Extension and Early Termination – Amendment reflects that parties may consent to extension or termination of the loss mitigation period. Where there is no consent, and an application to extend or terminate has been filed, the objection period has been extended from 3 days to 7 days. Amendment also modifies the impact on LMP when a case is dismissed.
Section X. Resolution – Amendment incorporates 2 new Local Form Orders: Order on Motion for Authorization to Enter into Final Loan Modification Agreement (Chapter 13) and Order on Motion for Authorization to Enter into Final Loan Modification Agreement (Chapter 11 or 12) which must be submitted with any motion seeking the Court’s authorization to enter into a loan modification.
Throughout LMP – Amendment replaces any 10-day timeframes with 14-day timeframes, includes additional service requirements, and implements several stylistic modifications.
The Third Amended General Order supersedes the General Orders of the Court entered on August 1, 2011, May 29, 2012, and September 19, 2013.
For ease of reference, this link may be used to review the Third Amended General Order and the revised LMP, including the following related local forms: Notice of Request for Loss Mitigation – By The Debtor; Notice of Request for Loss Mitigation – By A Creditor; Loss Mitigation Order; Interim Confirmation Order; Application for Extension or Early Termination of Loss Mitigation Period; Order Respecting Request for Extension or Early Termination of Loss Mitigation Period; Order on Motion for Authorization to Enter Into Final Loan Modification Agreement (Chapter 11 or 12); and Order on Motion for Authorization to Enter Into Final Loan Modification Agreement (Chapter 13).
The revised LMP and related local forms are also available in the Clerk’s Office and on the Court’s
website, www.njb.uscourts.gov.
Dated: December 17, 2019 Jeanne A. Naughton, Clerk