Long Island Judge Ends ‘Loss Mitigation’ in His Courtroom

Having decided that “Chapter 13 has morphed into the pursuit of loss mitigation as its sole purpose in which debtors file cases they never intend to bring to confirmation,” Bankruptcy Judge Robert E. Grossman decided it’s time to end so-called loss mitigation in his court.

In his February 28 opinion, Judge Grossman also decided it’s time to adopt a so-called no-look fee of $5,500 for chapter 13 cases in his court. Judge Grossman sits in Central Islip, N.Y.
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Although Judge Grossman ended loss mitigation in his court, the case before him resulted in a confirmed chapter 13 plan after the debtor and the home mortgage lender agreed on a loan modification. Aside from the case before him, Judge Grossman said he would no longer approve attorneys’ fees for participation in loss mitigation, “absent extraordinary circumstances.”