Loss Mitigation Program Frequently Asked Questions
Can I search these FAQ’s for terms or phrases?
Yes, you can search this page (and all pages on the WDPA Bankruptcy web page) by entering a term or phrase in the "Search this site" box located in the upper right hand corner of this page. After you enter a term or phrase just press the GO button. If your search returns more results than you like you can try to narrow down your search by putting the letters "LMP" before the search terms.
(For example, search for the word "interim" and note the results. Next try to search for "LMP interim", the results have greatly diminished and related only to LMP.)
When did the WDPA Bankruptcy Court Loss Mitigation Program ("LMP") start?
The Loss Mitigation Program began on October 1, 2012 by General Order #2012-7 and is now embodied in W.PA.LBR 9020-1 et seq.
Can more information about the WDPA Bankruptcy Court's LMP be found online?
Yes, the Court dedicated a portion of its website to the LMP. It can be found here http://www.pawb.uscourts.gov/loss-mitigation-program.
I want to file for Loss Mitigation. What do I do to start the Process?
First, you should read and review the Local Rules regarding the LMP. Then, if a Debtor qualifies for LMP after doing the appropriate Rule 9011 eligibility review, a Notice of Request for Loss Mitigation can be filed (Local Form 39 or 40).
I have filed a Notice of Request for Loss Mitigation. The Objection period has run but the LMP Order hasn't been issued. What should I do?
If the LMP Order hasn't been issued within 21 days of the filing of your Notice contact the appropriate Chambers to inquire as to the status.
I keep hearing about the "Portal"... what is that?
The Portal is the Default Mitigation Management (DMM) website that the WDPA Bankruptcy Court uses to facilitate all communication between Debtors and Lenders. Once the LMP process is commenced no communications between Lenders and Debtors are to be sent (about LMP) outside the Portal.
Are there any other portals than the DMM Portal?
Not at the present time. But other vendors like DMM may qualify to act as a portal operator in the future.
How do I get to the DMM Portal?
This is a link to the DMM Portal. https://www.dclmwp.com/.
How do I learn to use the DMM Portal?
DMM has provided an Attorney Manual.
If the Loss Mitigation Order is about to terminate and we are still communicating on the DMM Portal, or waiting for a determination of a loan modification, what should I do?
It is imperative for the Debtor/Counsel to file a Motion for Extension of the LMP prior to the expiration of the LMP. Once the LMP terminates there is no guarantee that it can be extended.
If either Party asks for an extension of the LMP how long of an extension will the Court grant?
If at the time of a Status Conference all Parties are actively working toward the resolution of the LMP, the Court will typically extend the LMP period for 30 days to a continued Status Conference hearing on a LMP hearing day. Therefore, Counsel is not required to file for an extension by separate Motion.
An extension of 60 days may be granted when it has been represented to the Court by all the Parties that a modification is imminent and more time is needed for review.
If, during an extension period, a modification is offered and accepted by the Parties, a Motion to Approve the modification (or Interim Modification Order) should be filed and the continued hearing may be cancelled.
When should a Debtor/Lender seek Loss Mitigation? How do I know if I qualify?
There are many factors that should be taken into consideration when evaluating whether a Debtor will qualify for loss mitigation. All Parties are required to perform the proper due diligence, i.e., the Rule 9011 eligibility review, with respect to the LMP before requesting entrance into the program. A good place to start any analysis is with the stated Purpose of the LMP, W.PA.LBR 9020-1(a).
What if a Debtor is not eligible for a loan modification due to a non-qualifying debt-to-income ratio (i.e. 31% rule)?
If it is clear that the debt-to-income ratio would result in a loan modification being rejected even before the filing of a request for LMP, not only will the LMP be terminated but Counsel fees may be denied to Debtor’s Counsel. If it only becomes clear after the Debtor enters the LMP that the income ratio makes the Debtor ineligible for a modification, any attorney’s fees (including the LMP no-look fee) will be subject to the Court’s determination as to whether the appropriate Rule 9011 eligibility review was completed prior to filing. For example, for information regarding HAMP edibility see http://www.makinghomeaffordable.gov/programs/lower-payments/Pages/hamp.aspx
Can a debtor file for LMP if they are unemployed?
Although all debtors that qualify for the LMP are encouraged to take advantage of the program, lenders may have policies which prohibit them from providing a loan modification to person's without income. Although debtor have hopes of obtaining employment 'at some time in the future' when filing for bankruptcy, the Court takes the snapshot in time approach and reviews them in light of the situation as it exists at the time the Petition was filed. As with all LMP's, debtors Counsel is required to perform the appropriate Rule 9011 eligibility review and the employment status of the debtor is part and parcel of that review.
In filing a Motion to Approve a modification should the Debtor include information regarding what the loan terms were PRIOR TO the modification.
Yes, it should be shown that the modification is beneficial to the Debtor and the terms have improved as a result of the LMP.
The Debtor has been approved for a Trial Loan Modification, what are the procedures?
File an Interim Trial Mortgage Modification Order. Include the amount of the trial payment and the months in which it is to be paid. Upon entry of the Order immediately serve the Ch. 13 Trustee so timely disbursements can occur. The LMP will be extended until final modification is granted. The Interim Mortgage Modification Form can be found at the Court's Loss Mitigation Program page.
Are Status Reports required during the LMP?
Yes, the Loss Mitigation Order provides that within 60 days from the entry of the LMP Order the Debtor must file and serve the Loss Mitigation Status Report, Local Form 42. Also, 14 days after termination f the LMP period the Debtor must file and serve the Loss Mitigation Final Report, Local Form 46. Finally, the Court may require additional Status Reports as needed.
Should I self-schedule a Motion to Approve Loan Modification?
No. Provided the Trustee consents, typically the Motion to Approve Loan Modification will be granted without hearing so long as it shows a benefit to the estate justifying the cost and expense (attorney fee) involved in obtaining the modification. If the Court feels a hearing is required it will schedule the matter. Also, do not self-schedule when filing the Interim Mortgage Modification Order.
How often will the Court conduct hearing regarding LMP matters?
The Court will conduct hearings every 2 weeks on LMP matters. Thus, Counsel should expect that any matters filed, seeking a hearing will be held, at the latest, within 2 weeks.
What happens if a Lender/Servicer stops responding on the Portal and I still have no resolution to my request for Loss Mitigation?
The Debtor should file a Motion for a Status Conference.
If a final Mortgage Modification is approved do I need to file an Amended Plan.
If only the payment amount changes, no. The modification Order can direct the Trustee to adjust the distribution to the creditor consistent with the Order granting the modification terms.
Can my Chapter 7 Debtor file for loan modification through the LMP?
Yes. Debtors Counsel should be aware of several unique circumstances relating to LMP's in Chapter 7 cases. Special factors to be considered are: whether a reaffirmation is needed and/or has been filed; whether Counsel should seek delay of the entry of a discharge order; and, whether the servicer will consider LMP if a discharge order has already been entered. These are just a few of the many factors to be considered in light of the Court's view that a loan modification may be considered a new obligation to which the debtor is bound.
If the Debtor(s) is not participating in the LMP or has decided he/she no longer want to be in the program, what should I do?
File a Notice of Early Termination (if LMP has not already expired on its own) and give specific details as to the reason.
What if my Servicer changes or my loan is transferred? What do I do.
The Servicers have many obligations with respect to the mortgage and claim which should be handled timely in the event of transfer. The LMP does not grant an exception to a Lender or servicer when servicing responsibilities are transferred. The Lender and/or servicer is required to act within a certain specified time period by Court Order. The mere fact a transfer of servicing duties occurred does not suspend the Lender/Servicer's good faith responsibilities to act timely while in the LMP.
As far as the procedural aspect, and not eliminating the Lender/Servicer's good faith duties set forth above, with respect to the Debtor's account in the DMM Portal, Counsel should take the following action in order to assume timely processing:
- (1) Log into the Portal;
- (2) Navigate to Borrower's Account Page;
- (3) Click Email Servicer (and/or Email Attorney as the case may be);
- (4) In the text of the message, they should advise that there is a new servicer and send the message;
- (5) This Portal email should also add firstname.lastname@example.org to the cc box;
(6) Upon receipt of the message at DMM, they will go in and transfer the account to the new servicer;
- a. This deletes the account from the old servicer; and
- b. Submits account to the new servicer as if it were a brand new submission
I changed my servicer on the DMM Portal pursuant to the procedure in the FAQ's, is there anything else I need to do?
Yes. To have the servicer changed (and obligated) with respect to the Loss Mitigation Order Debtors Counsel must file the Change of Servicer Form. The Form can be found on the Court’s Website here: http://www.pawb.uscourts.gov/loss-mitigation-program.
What do I do if a Party (Debtor or Lender) communicates with me outside the Portal by email/fax/US mail?
Communications outside the Portal are prohibited by the LMP. If a communication is sent outside the Portal the Party receiving the communication should post the communication on the Portal and file a request for a Status Conference to bring the matter the Court's attention.
What if it's clear from the Portal activity that either the Lender/Servicer or the Debtor is not acting in good faith?
It is incumbent up the complaining Party to make the Court aware of the lack of good faith. This can be done by indicating the same on a Status Report or by filing a "Motion to Compel Compliance with the LMP Process" which will result in an immediate hearing within 2 weeks at the next available LMP hearing date.
I would like to contact the Counsel for servicer XYZ, who is that person and how do I reach them?
In the WDPA only, the Court has identified several attorneys who, as of now, represent specific services in most cases. These attorney should only be contacted outside the Portal if absolutely necessary:
Bank of America - Scott Schuster, Esq. - McGuireWoods, LLP
Citimortgage - James Prostko, Esq. - Phelan Hallinan, LLP
Ocwen - Brett Messinger, Esq. - Duane Morris LLP
What if a Lender/Servicer is not registered on the Portal when I file my Notice of Request for Loss Mitigation?
Assuming no objection is raised to the Debtor's properly filed and served Notice of Request for Loss Mitigation, a Loss Mitigation Order will be issued. The Loss Mitigation Order gives the Lender/Servicer 14 days to register on the Portal and upload its initial loss mitigation requirements ("Creditors Initial Package").
I'm a Lender/Servicer and I've registered on the Portal and uploaded my initial creditor package. Do I have to do that in every case?
No, once a Lender/Servicer uploads the initial creditor package the first time that same information will be used for all subsequent LMP accounts for that Lender/Servicer.
I'm having a problem with my Portal account/login and/or I'm having a problem with one of my client's Portal Accounts, what do I do?
Contact Igor Roitburg, COO of Default Mitigation Management LLC (DMM) at 1-800-481-1013.
I have a question about the LMP program, who do I ask?
The Court has setup the ability to submit a question to the Court from its website. Look for the "Submit a Question" link at the bottom of this page.
What Lenders/Servicers are registered on the Portal?
21st Mortgage Corporation
Alliance Realty Capital
Alliant Credit Union
Ameriserv Financial Bank
AMS Servicing LLC
Bank of America / Countrywide
Bayview Loan Servicing
Beneficial Finance / Household Finance
BMO Harris Bank N.A.
BSI Financial Services, Inc.
Carrington Mortgage Services, LLC
Central Mortgage Company
CGH Federal Credit Union
Charleroi Federal Savings Bank
Chase / EMC / WaMu
CitiMortgage / CitiFinancial / Onemain Financial
Clearfield Bank & Trust Company
Clearview Federal Credit Union
Community Bank Community National Bank of Northwest Pennsylvania
Dollar Bank, FSB
Dovenmuehle Mortgage, Inc.
Farmers & Merchants Bank of Western PA
Farmers National Bank of Emlenton
Fifth Third Bank
First Commonwealth (Indiana, PA)
First Horizon / First Tennessee
First National Bank of Pennsylvania
FNB Consumer Discount Company
Green Tree Servicing, LLC
Grove City Area Federal Credit Union
Homeplus Finance Corporation
IMA Fund I, LLC
Indiana First Savings Bank (Indiana, PA)
INTERSTATE INTRINSIC VALUE FUND A, LLC
Kentucky Housing Corporation
Kondaur Capital Corporation
Marion Center Bank
Marquette Savings Bank
Mercer County State Bank
MetLife Home Loans
Midland Mortgage / MidFirst Bank
Midwest Loan Services, Inc.
Nationstar Mortgage, LLC
Nationwide Advantage Mortgage Company
Navy Federal Credit Union
Northwest Consumer Discount Co.
Northwest Savings Bank
Ocwen Loan Servicing (Litton / Saxon)
Ocwen Loan Servicing (previously GMAC Mortgage)
Pennsylvania Housing Finance Agency
PennyMac Loan Services
PHH Mortgage Corp.
RBS Citizens, NA
Real Time Resolutions, Inc.
Residential Credit Solutions
Resurgent Capital Services
Rushmore Management, LLC
S & T Bank
Saxon Mortgage Services
Select Portfolio Servicing
Selene Finance LP
Slovak Savings Bank
SN Servicing Corporation
Specialized Loan Servicing, LLC
Springleaf Financial Services of Pennsylvania
Statebridge Company, LLC
SunTrust Banks, Inc.
Tammac Holdings Corporation
U.S. Bank Home Mortgage
Union Building and Loan Savings Bank
United Guaranty Residential Insurance Company of North Carolina
Vanderbilt Mortgage and Finance, Inc.
Wells Fargo Financial
Wells Fargo Home Mortgage / Americas Servicing Company
If I missed the Loss Mitigation filing date will the Court accept a Motion for Nunc Pro Tunc issuance of a Loss Mitigation Order upon filing of such a request?
Typically, if a Party fails to timely register for the LMP, the Court will deny any nunc pro tunc request for admission into the LMP. The reason for this is that as of now the LMP was solely designed to give Debtors an opportunity early in a case to work through the Portal and obtain a modification assuming the stated time limits were complied with. This was the "pact" made with representatives of the lenders' community who worked on the Loss Mitigation Committee when we sought consensus for a mandatory program. It is for this reason the Court will not waive the time for compliance with initiating the LMP unless appropriate cause or exigent circumstances for missing the deadline is alleged in any such Motion. If the lender consent is made part of the Motion seeking nunc pro tunc admission in the LMP, the Court will consider a late filing, after hearing. Similarly, this rule applies with respect to untimely filed Motions to Extend Time for the Program. These will typically be denied without a hearing unless the consent of the lender is included in the Motion or appropriate cause is demonstrated.
What do we do if the debtors decide they no longer are interested in participating in the LMP?
The debtors should file a "Notice of Early Termination" with an explanation as to why this relief is being sought. In those cases where it is clear no success will be realized prior to the due date for filing the Final Report, counsel should also file a "Notice of Early Termination." It is important to make clear in the filing however, to insure that counsel will be paid, the reason(s) for early termination and not simply because debtors' counsel failed to timely act or failed to diligently pursue the LMP. Otherwise, fees will be denied and the Chapter 13 Trustee notified in this regard.
Assuming debtors' counsel acted in good faith throughout the LMP and no actual loan modification was allowed, is counsel allowed a no-look fee and/or can counsel bill for actual time involved?
Yes. The success of the LMP comes in many forms, one of which being that parties have worked in good faith to obtain a modification but were unable to do so. Under these circumstances debtors' counsel is entitled to being paid and the Court will allow the no-look fee or approve fees reflecting actual time billed in good faith for services related to processing the LMP.
If a Loan Modification is approved and the only change is the amount of the payment to the lender, do I need to file an Amended Plan?
No, the Order granting the Modification should direct the Trustee to adjust the payment to the lender.
If you are unable to find the answer you're looking for submit a question to us. We'll answer your question and add it to FAQ to assist others.
Disclaimer: The questions and answers provided in the FAQ are for informational purposes only and should not be considered an opinion, advisory or otherwise, of the Court. External websites linked to these FAQ's are not endorsed by the Court and the information contained in any external website may not be relied upon for any purpose.