(a) Eligibility for Use of Notice of Exception to Filing a Notice of Payment Change
A creditor may use the procedure provided for by this local rule if:
(1) the creditor asserts a claim secured by a security interest in the Debtor’s real property;
(2) that claim is provided for in the plan under §1322(b)(5); and
(3) the monthly amount due on the claim changes more than once every sixty (60) days because the creditor’s agreement with the Debtor provides for a variable interest rate and/or a variable payment amount, or the creditor is eligible for the exception in subparagraph (e).
(b) Filing and Effect of Filing Notice of Exception to Filing a Notice of Payment Change
If a creditor is eligible pursuant to subparagraph (a) of this rule, then the creditor shall be excused from the requirements of Fed.R.Bankr.P. 3002.1(b), requiring filing of a notice of payment change twenty-one (21) days prior to the change, if the creditor files a Notice of Exception to Filing a Notice of Payment Change (“Notice of Exception”) and serves that Notice of Exception on the trustee, the Debtor, and the UST. If no objection to the Notice of Exception is filed pursuant to subparagraph (c), or if the Court determines after objection that the exception should apply, then the creditor is excused from filing any Notice of Payment Change other than a change resulting from a variance in the interest rate.
Any party may object to the Notice of Exception within twenty-one (21) days after the Notice is filed.
(d) Duty to Provide Information
A creditor subject to the exception shall provide to the Debtor and the trustee each month a statement in a customary form in accordance with applicable non-bankruptcy law that clearly identifies the payment amount due on the claim, and in addition shall provide to the trustee or the Debtor, upon request, an updated total amount due.
(e) Limited Exception During Loan Modification Process
If the Debtor files a Motion to Approve Loss Mitigation Agreement, a Motion to Approve a Trial Modification Agreement, or a Motion to Modify Secured Debt (collectively, a “Modification Motion”), the creditor is excused from filing a Notice of Payment Change while that Modification Motion is pending. No later than twenty-one (21) days after the date of the entry of an order approving the Modification Motion, a creditor shall file and serve on the trustee, the Debtor, and the UST a Notice of Payment Change.