Illinois Court Ruling a Victory for Servicers

Mortgage companies have scored a victory in the bankruptcy court for the Northern District of Illinois, according to the law firm of Stewart Chapman, Pierce & Associates.In the case of CTX Mortgage v. William Graf, the law firm had argued that a forced "reinstatement" of the loan according to a model plan was improper. The court ruled that "a confirmed plan cannot trump a presumptively valid secured claim." That reversed a lower court ruling, and the case has been remanded back to the lower bankruptcy court. The dispute centered on the amount of arrears owed by the borrower.