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Truth in Lending: 9.10.4.1 Coverage

Periodic statements are required as of January 10, 2014, for all closed-end residential mortgage loans secured by a dwelling.1265 Section 1638(g) should apply to Property Assessed Clean Energy (PACE) loans.1266 The issue of whether PACE loans constitute “credit” under TILA is discussed in § 2.7.9.3, supra.

Truth in Lending: 9.6.2.1 General

HOEPA defines a special class of covered mortgage loans, including first and subordinate lien loans626 by setting up triggers (originally two but now three) for the special protections of the law. These triggers are found in the Truth in Lending definition section at 15 U.S.C. § 1602(bb). The original version of HOEPA included just an APR trigger and a points and fees trigger, but the Dodd-Frank Act creates a third trigger based solely on the timing or amount of prepayment penalties.627

Consumer Bankruptcy Law and Practice: 12.9.2 Assumption of a Lease or Executory Contract in Chapter 13

In many cases, a debtor will have much to gain from assumption of an executory contract or unexpired lease. For example, if moving would cause a hardship, or if a residential lease has favorable terms, it is usually advantageous to keep it in effect. This may be particularly true in a rent control jurisdiction499 or in public housing, as the debtor’s occupancy may not otherwise be terminable even at the end of the lease term.

Truth in Lending: 9.6.10.1 Introduction

HOEPA includes substantive protections that ban certain terms for covered high-cost loans. In addition to triggering civil liability and special damage remedies,802 inclusion of a prohibited term constitutes a failure to deliver required disclosures for the purposes of rescission under TILA.803 Most of these prohibitions are not absolute. Care should be taken to make sure that where an exception is invoked, the creditor has met the preconditions to the exception.

Truth in Lending: 9.10.8 Pyramiding of Late Fees

Effective January 10, 2014, the CFPB adopted a rule similar to the prior FRB rule (discussed in companion materials), but removed any reference to a “full” payment and instead applied the requirement only to “a periodic payment.”1390 The distinction between the meanings for “full” payment and “periodic” payment intended by this change in the regulations is unclear.

Truth in Lending: 9.5.4.5.1 General

Unless an exemption applies (described below), creditors of higher-priced mortgage loans (HPMLs) must establish an escrow account for the payment of property taxes and insurance.503 The FRB’s original mandatory escrow rule applies to higher-priced mortgage loans if the loan application was received on or after April 1, 2010 (October 1, 2010, for manufactured homes).504 This rule was substantially modified by the FRB, pursuant to the Dodd-Frank Act, by setting a higher threshold for mandatory

Consumer Bankruptcy Law and Practice: Rule 2013. Public Record of Compensation Awarded to Trustees, Examiners, and Professionals

(a) RECORD TO BE KEPT. The clerk shall maintain a public record listing fees awarded by the court (1) to trustees and attorneys, accountants, appraisers, auctioneers and other professionals employed by trustees, and (2) to examiners. The record shall include the name and docket number of the case, the name of the individual or firm receiving the fee and the amount of the fee awarded. The record shall be maintained chronologically and shall be kept current and open to examination by the public without charge.

Consumer Bankruptcy Law and Practice: Rule 2014. Employment of Professional Persons

(a) APPLICATION FOR AN ORDER OF EMPLOYMENT. An order approving the employment of attorneys, accountants, appraisers, auctioneers, agents, or other professionals pursuant to § 327, § 1103, or § 1114 of the Code shall be made only on application of the trustee or committee. The application shall be filed and, unless the case is a chapter 9 municipality case, a copy of the application shall be transmitted by the applicant to the United States trustee.

Consumer Bankruptcy Law and Practice: Rule 2015. Duty to Keep Records, Make Reports, and Give Notice of Case or Change of Status

(a) Trustee or Debtor in Possession. A trustee or debtor in possession shall:

(1) in a chapter 7 liquidation case and, if the court directs, in a chapter 11 reorganization case (other than under subchapter V), file and transmit to the United States trustee a complete inventory of the property of the debtor within 30 days after qualifying as a trustee or debtor in possession, unless such an inventory has already been filed;

Consumer Bankruptcy Law and Practice: Rule 2015.2. Transfer of Patient in Health Care Business Case

Unless the court orders otherwise, if the debtor is a health care business, the trustee may not transfer a patient to another health care business under § 704(a)(12) of the Code unless the trustee gives at least 14 days’ notice of the transfer to the patient care ombudsman, if any, the patient, and any family member or other contact person whose name and address has been given to the trustee or the debtor for the purpose of providing information regarding the patient’s health care. The notice is subject to applicable nonbankruptcy law relating to patient privacy.

Consumer Bankruptcy Law and Practice: Rule 2015.3. Reports of Financial Information on Entities in Which a Chapter 11 Estate Holds a Controlling or Substantial Interest

(a) REPORTING REQUIREMENT. In a chapter 11 case, the trustee or debtor in possession shall file periodic financial reports of the value, operations, and profitability of each entity that is not a publicly traded corporation or a debtor in a case under title 11, and in which the estate holds a substantial or controlling interest. The reports shall be prepared as prescribed by the appropriate Official Form, and shall be based upon the most recent information reasonably available to the trustee or debtor in possession.

Consumer Bankruptcy Law and Practice: Rule 2017. Examination of Debtor’s Transactions with Debtor’s Attorney

(a) PAYMENT OR TRANSFER TO ATTORNEY BEFORE ORDER FOR RELIEF. On motion by any party in interest or on the court’s own initiative, the court after notice and a hearing may determine whether any payment of money or any transfer of property by the debtor, made directly or indirectly and in contemplation of the filing of a petition under the Code by or against the debtor or before entry of the order for relief in an involuntary case, to an attorney for services rendered or to be rendered is excessive.

Consumer Bankruptcy Law and Practice: Rule 2019. Disclosure Regarding Representation of Creditors and Equity Security Holders in Chapter 9 and Chapter 11 Cases

(a) Definitions. In this rule the following terms have the meanings indicated:

(1) “Disclosable economic interest” means any claim, interest, pledge, lien, option, participation, derivative instrument, or any other right or derivative right granting the holder an economic interest that is affected by the value, acquisition, or disposition of a claim or interest.

Consumer Bankruptcy Law and Practice: Rule 3001. Proof of Claim

(a) FORM AND CONTENT. A proof of claim is a written statement setting forth a creditor’s claim. A proof of claim shall conform substantially to the appropriate Official Form.

(b) WHO MAY EXECUTE. A proof of claim shall be executed by the creditor or the creditor’s authorized agent except as provided in Rules 3004 and 3005.

(c) Supporting Information.

Consumer Bankruptcy Law and Practice: Rule 3002. Filing Proof of Claim or Interest

(a) Necessity for Filing. A secured creditor, unsecured creditor, or equity security holder must file a proof of claim or interest for the claim or interest to be allowed, except as provided in Rules 1019(3), 3003, 3004 and 3005. A lien that secures a claim against the debtor is not void due only to the failure of any entity to file a proof of claim.

(b) Place of Filing. A proof of claim or interest shall be filed in accordance with Rule 5005.

Consumer Bankruptcy Law and Practice: Rule 3002.1. Notice Relating to Claims Secured by Security Interest in the Debtor’s Principal Residence

(a) IN GENERAL. This rule applies in a chapter 13 case to claims (1) that are secured by a security interest in the debtor’s principal residence, and (2) for which the plan provides that either the trustee or the debtor will make contractual installment payments. Unless the court orders otherwise, the notice requirements of this rule cease to apply when an order terminating or annulling the automatic stay becomes effective with respect to the residence that secures the claim.

(b) NOTICE OF PAYMENT CHANGES; OBJECTION.