(Published) - Ogden v. PNC Bank, N.A., Adversary Proceeding No. 13-01054 EEB

Chapter 13 debtor filed a complaint against her mortgage lender, alleging the bank violated the automatic stay, her chapter 13 plan, the confirmation order and Fed. R. Bankr. P. 3002.1, by misapplying her postpetition mortgage payments and raising the amount of her postpetition payments to recover prepetition arrears. The Court found the bank had created confusion in its system of accounting, which essentially keeps two sets of books to reflect postpetition mortgage payments—one for bankruptcy purposes and one for non-bankruptcy purposes. The non-bankruptcy accounting tracks all amounts contractually due under debtor's loan, including late fees, in the event that debtor fails to complete her chapter 13 plan. The bank failed to clearly communicate this fact to the Debtor. However, because the bank had not sought to collect contractually-due late fees in bankruptcy, the Court found no violation of the Code attributable to this accounting system. The Court noted that the Code only provides for limited court oversight of mortgage lenders during the term of a chapter 13 plan, and that debtor may have remedies under RESPA or, at the conclusion of her plan, under 11 U.S.C. § 524(i), if the bank fails to appropriately account for her payments.