Bankruptcy Proof of Claim Form Gets a Makeover

Several of the Official Bankruptcy Forms will be replaced on December 1, 2015. For creditors, the most notable changes will be to two forms: the Proof of Claim form, Form 410, and the Mortgage Proof of Claim Attachment, Form 410A. These changes reflect an effort by the Bankruptcy Courts to elicit a clear and complete picture of what the debtor owes and how much must be paid to cure a pre-bankruptcy arrearage. Due to the Bankruptcy Court’s focus on clarity, creditors are well advised to closely follow the claim forms and accompanying instructions.

Changes to the Official Proof of Claim Form – New Form 410

The new Proof of Claim form looks substantially different from the current form. However, most of the changes are aesthetic with updated formatting and numbering. For the most part, the new Proof of Claim form requires the same information that was required under the current Proof of Claim form. However, there are a few substantive changes, including:

• Questions regarding whether the claim is based on a lease, which does not exist in the prior form.
• Questions regarding whether the claim is “subject to a right of setoff,” whereas the prior form only mentions setoff rights in small print in the secured-claim section.
• A requirement that the claimant identify whether the claim was acquired from someone else and from whom it was acquired.
• A requirement per the Instructions that involves, to the extent applicable, attachment to the Proof of Claim of documents showing that the debt has been assigned and/or transferred.

In addition to carefully reviewing the instructions and changes to the new form, creditors should also note where requirements to comply with separate Bankruptcy Code sections are cited. For example, under Bankruptcy Rule 3001(c)(3), cited under new Proof of Claim Form question #8, if the claim is based on an open-end or revolving consumer credit agreement (other than a claim secured by the debtor’s real property), then the proof of claim needs to include a statement detailing “(1) the name of the entity from whom the creditor purchased the account, if any; (2) the name of the entity to whom the debt was owed at the time of an account holder’s last transaction on the account; (3) the date of an account holder’s last transaction; (4) the date of the last payment on the account; and (5) the date on which the account was charged to profit and loss.”

Changes to Mortgage Proof of Claim Attachment – New Form 410A

The new Mortgage Proof of Claim Attachment form, which must be attached to any Proof of Claim based on a claim secured by property that is the debtor’s principal residence, has also been significantly revised.

The new Form is divided into five parts. Part 1 is for the Mortgage and Case Information; Part 2 provides for the Total Debt Calculation; Part 3 provides for payment Arrearages as of the Date of the Petition Date; Part 4 provides the information regarding the monthly post-petition mortgage payment; and Part 5 provides for a Loan Payment History after the First Date of Default.

The new Form requires much of the same overall information required under the existing Mortgage Attachment. The biggest change is that the new form requires the creditor to submit a detailed loan history that, in a format set forth in the Attachment, beginning with the “first date of default,” reveals all payments that were received, how the amounts were applied, when fees and charges were incurred, and when escrow charges were satisfied. The “first date of default” is defined to be “the first date on which the borrower failed to make a payment in accordance with terms of the note and mortgage, unless the note was subsequently brought current with no principal, interest, fees, escrow payments or other charges immediately payable.”

The new forms will should make completing claims correctly, as well as other bankruptcy tasks, simpler and easier for creditors. Nonetheless, creditors should consult with counsel if they have questions about the new forms.