April deadline set for filing claim against mortgage company

By Sean F. Driscoll

BusinessRockford.com

Investors in Commercial Mortgage and Finance will have until April 9 to file a claim against the company in its bankruptcy case, a federal judge ruled today.

Commercial Mortgage owes more than $60 million to its 1,400 creditors, most of whom invested money in the company’s promissory notes. The notes were issued on a six- or nine-month term and offered higher interest rates than traditional certificates of deposit,

The investors — who are owed an average of $51,000 each — can file a proof of claim form to verify that their investment records match those of Commercial Mortgage. If an investor doesn’t file a claim, they won’t lose their stake on their investment; instead, they’ll have to take Commercial Mortgage’s word for how much money they’re owed, said Gregory Jordan, an attorney representing the company.

If an investor already has filed a proof of claim, they don’t need to do so again before the deadline, Jordan said.

The claims deadline — initially proposed for March 9 but extended by a month — is the first step of many toward establishing a schedule for the beleaguered company to exit bankruptcy. Jordan has indicated that the process may be done by Aug. 15.

Also today, a hearing on the proposed timeline for filing a reorganization plan was delayed until Feb. 18 to give Jordan and the five-member creditors committee time to meet and discuss developing the plan. Jordan has proposed a May 6 deadline to file the plan, which would give creditors until July 6 to review it.

Commercial Mortgage & Finance Co. does not own CMF Insurance Agency of Rockford.

Reach staff writer Sean F. Driscoll at 815-987-1346 or sdriscoll@rrstar.com.