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From the Editor – Curing Defaults
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By The Honorable William Houston Brown (Retired)
Cure of defaults did not include reinstatement of pre-default interest rate. The Fourth Circuit held that when the debtors had defaulted on their mortgage pre-bankruptcy and the lenders had imposed increased contractual default interest rate, § 1322(b)(2)’s antimodification provision prevented reduction of that default interest rate. “Cure” under §§ 1322(b)(3) and (5) did not include the ability to reinstate the pre-default interest rate, and the negotiated default rate was required for the debtors to maintain mortgage payments. Anderson v. Hancock, 820 . . .
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