It's my understanding that the new bankruptcy statement requirements will apply regardless of whether the consumer became a debtor in bankruptcy before or after the final rule's effective date.

In the past, we have not tracked pre-petition payment amounts in our core system. And we're now required to provide a bankruptcy statement showing the total of all pre-petition payments received since the beginning of the consumer's bankruptcy case!! Anyone else running into this operationally impossible nightmare??

How have you tracked application of payments towards pre and post petition payments for reporting purposes in the past?

We've tracked them manually, but did not have a way to track them in our core system. Due to the new rule, our core system has made adjustments so that we now have the ability to track these going forward. Since this rule is retroactive, our pre-petition and post-petition totals will not be correct unless we go back and update every single payment previously made. Or am I overthinking this?

No, you seem to have a good grasp of the challenge.

John is right, it's true you'll need to enter those amounts in. Though, the spreadsheet (?) you keep for your records today should make that relatively short work (although, I agree it is certainly more work than what we're doing now). Good luck!

We are trying to test different scenarios to see how the pre-petition arrearage box will appear on our statements. If a loan was accelerated pre-petition, does it make sense to use the entire balance less pre-petition payments made as the Current Balance in the pre-petition arrearage box?

We are struggling with the same issue. This information is tracked in our Legal department, not in loan servicing. Trying to determine who will monitor/input amounts. Any advice would be greatly appreciated.

Can anyone tell me if we HAVE to have the pre/post arrearage on statement if the account is current and our debt is NOT included in the plan? I’m assuming NO, since the amount will be 0.00, but just making sure that we are not required to print 0.00 on the statement….

If the mortgage loan is not part of the bankruptcy debt, then you'd simply be sending the borrowers the standard mortgage periodic statement. No need for the Chapter 12/13 bankruptcy version separating pre and post petition amounts.

Thank you...very helpful.

We have the same situation as Still Smiling. Our borrower has filed Chapter 13 Bankruptcy but his mortgage with us is up to date and there won't be a pre-petition arrearage. But I don't think we can just provide the standard mortgage periodic statement. It looks to me like we still need to provide the notices required by 1026.41(f)(2) and also 1026.41(f)(3)(vi) if they apply:

1026.41(f)(2) Bankruptcy notices. The periodic statement must include the following:
(i) A statement identifying the consumer's status as a debtor in bankruptcy or the discharged status of the mortgage loan; and
(ii) A statement that the periodic statement is for informational purposes only.

1026.41(f)(3)(vi) Additional disclosures. The periodic statement must include, as applicable:
(A) A statement that the amount due includes only post-petition payments and does not include other payments that may be due under the terms of the consumer’s bankruptcy plan;
(B) If the consumer's bankruptcy plan requires the consumer to make the post-petition mortgage payments directly to a bankruptcy trustee, a statement that the consumer should send the payment to the trustee and not to the servicer;
(C) A statement that the information disclosed on the periodic statement may not include payments the consumer has made to the trustee and may not be consistent with the trustee’s records;
(D) A statement that encourages the consumer to contact the consumer's attorney or the trustee with questions regarding the application of payments; and
(E) If the consumer is more than 45 days delinquent on post-petition payments, a statement that the servicer has not received all the payments that became due since the consumer filed for bankruptcy.

Or am I missing something?

You need to talk with your bankruptcy department/counsel. It depends on whether the mortgage loan is included in the bankruptcy case or not. That's a technical determination you need to make with your legal counsel. I agree if it is covered by the automatic stay, then you need to send the new bankruptcy version of the periodic statement. If it isn't, then it's the normal statement.