Order Overruling Debtors' Objection to Notice of Mortgage Payment Change (Doc. 65)

GUY R. HUMPHREY, Bankruptcy Judge.

This matter is before the court on the Debtors' Objection to Notice of Mortgage Payment Change filed by U.S. Bank National Association (doc. 65) and Response to Objection to Notice of Mortgage Payment Change (doc. 68) (the "Contested Matter").

Pursuant to a prior Order (doc. 74), the court conducted a hearing on February 12, 2020. The hearing was attended by Stephen Malkiewicz, counsel for the Debtors, and Steven H. Patterson, counsel for Creditor U.S. Bank National Association ("U.S. Bank"). The court heard testimony from Sean Duffy, an employee and representative of U.S. Bank. Further, with no objection from the parties, the court admitted Debtors' Exhibits 1-3 and U.S. Bank's Exhibits A, J, K and M.

The court considered the demeanor and credibility of the witness who testified and all admitted exhibits, as well as the filings and oral arguments of Mr. Malkiewicz and Mr. Patterson in reaching its determination. The court found Mr. Duffy to be credible.

Mr. Duffy testified as to U.S. Bank's records concerning the debtors', Brian Keith Morgan and Jessica Lynn Morgan, mortgage loan account history with U.S. Bank. In particular, he testified as to Exhibit J, which is a printout of the Morgans' transactional debit and credit history with the bank. His testimony focused on payments or disbursements which U.S. Bank made for the Morgans' real property or hazard insurance. A payment of $2,264 on November 23, 2018 was particularly at issue. The testimony established that during the relevant time period in question the Morgans' switched insurers from State Farm to Liberty Mutual. In addition, the evidence established that U.S. Bank sent letters to the Morgans advising them that they would be receiving refund checks from their real property insurer and that they should forward the funds representing those refunds to U.S. Bank for their account to reduce their escrow account maintained for property insurance and real estate taxes. The evidence established that the Morgans did not forward those funds to U.S. Bank. The Morgans did not appear and testify, so there was no testimony to refute U.S. Bank's records and Mr. Duffy's testimony.

Based upon the evidence admitted during the hearing,1 the court finds that the Morgans received refunds relating to hazard insurance premiums advanced by U.S. Bank from their insurance provider and despite U.S. Bank's requests that the Morgans forward to it the funds representing those refunds so they could be applied to the escrow account, the Morgans failed to do so which resulted in the escrow shortage. Further, the charges which the Morgans' counsel deemed "questionable" during the hearing were explained by the evidence presented. Therefore, U.S. Bank's Notice of Mortgage Payment Change, which increases the Morgans' escrow account payments from $195.61 to $479.28 to address the escrow shortage, is determined appropriate.

Based upon the foregoing, the Debtors' Objection to Notice of Mortgage Payment Change filed by U.S. Bank National Association (doc. 65) is overruled.

IT IS SO ORDERED.