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We had to file bankruptcy last year, 2012. It...

Resolved • Response time 12 minutes

12 May 2013

We had to file bankruptcy last year, 2012. It was discharged back in Oct of 2012. We had two cars, 1) A 2010 Nissan Sentra with 40,000 miles on it. 2) 2003 Ford Ranger 110,000 miles. The Nissan was still under contract for 15,000.... The Ford had been paid for, but we used it as collateral for a personal loan. A personal loan for a total of 22k.... My attorney was under some impression that we wanted to let the car go back and keep the truck!!! I told them, no.... the car is a 2010 with low miles, the truck is worth 4k out of the blue book. We are not going to reaffirm the loan that has a high interest rate, in order to keep a truck that is close to 10 years old. So, I got that straightened out.... they, the attorneys office could not get the finance company to reaffirm the loan on the Nissan, and they ended up repo the car. We didn't not reaffirm the personal loan, CitiFinancial never repo'd the truck. It has been 8 months now, and we are stuck. We prefer to trade in the truck on a newer truck, but CitiFinancial, even though we are released in the bankruptcy, will not release the lien? After talking to the attorney, they said to take my bankruptcy paperwork down to DMV and have the title remove the lien info. The DMV refused. What do we do? We were willing to reaffirm the loan for what the blue book was, but our attorney didn't contact CitiFinancial. We can not sell this truck, trade it in, or anything. And how long do we have to live with wondering if someone is going to come and repo this truck?? I thought we were allowed to be able to keep one vehicle? Not a 2003, that has previously been paid for, that now has a price tag of 22k? Please advise
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12 May 2013

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Bankruptcy Lawyer's response
12 May 2013
FiveStarLaw
FiveStarLaw
Attorney
Welcome, I am a Florida licensed attorney as well as a member of the bankruptcy bar of the Southern District of Florida. My name is XXXXXXXXXXX XXX I will do whatever I can to answer your questions! There appears to be a misunderstanding regarding liens and the effect of a chapter 7 bankruptcy on those liens. After I explain, you can follow up by clicking reply if any of my answer is not clear or does not make sense to you. A chapter 7 bankruptcy does not remove a lien. Instead a chapter 7 bankruptcy discharges a debtors personal liability on the loans associated with the lien. The lien itself remains on the vehicles. This means if the vehicle were to be repossessed, the lienholder could sell the vehicle to satisfy the debt but could not obtain a judgment against you for the unsatisfied portion of the debt. However it also means that you cannot sell the vehicle or obtain a clear title without paying the lien in full Florida law does allow a bankruptcy debtor an exemption of $1000 in a motor vehicle. In addition a debtor may claim $4000 in any personal property if there is not also a homestead exemption claimed. See Florida Statute Section 222.25. I would be glad to respond to any related follow-up questions that you may have.
12 May 2013
Customer reply
12 May 2013
So, we are just out of luck? I guess that isn't the correct word.... what do we do with this vehicle? The finance company is in Kentucky... I don't think it appropriate to just abandon it?
12 May 2013
Customer reply
12 May 2013
Also, it doesn't make a difference if this loan was NOT a auto loan?
12 May 2013
Bankruptcy Lawyer's response
12 May 2013
FiveStarLaw
FiveStarLaw
Attorney
If the loan was secured on the title, it is treated the same as an auto loan in a bankruptcy unless your attorney filed a separate action called an Adversary Proceeding. In an adversary proceeding your attorney could ask the court to set aside the lien to the extent that it impairs your exemption. This would mean that the amount equal to your exemption would not be subject to the lien.
12 May 2013
Customer reply
12 May 2013
It sounds to me that I was very poorly represented.... as there was talk of having, forgive me if I can't remember the exact name... something regarding having our truck revalued. We rent, we don't own, in fact we did own but the house back in Kentucky was supposed to be "deed in lieu of foreclosure" the people who worked in the law office dropped the ball on that one too. We are being foreclosed on now. I feel like contacting the courts and requesting some sort of review as several things were seriously overlooked. My attorney should have filed a separate action called adversary proceedings. I feel as though my bankruptcy was in vain. I hated to go forward with it, but had finally had no choice. But for what?
12 May 2013
Bankruptcy Lawyer's response
12 May 2013
FiveStarLaw
FiveStarLaw
Attorney
Yes it does appear that you received poor information. As for the house in Kentucky– it would be the same situation as the vehicles. The lender can foreclose on the house but cannot pursue a deficiency judgment against you unless you reaffirmed the mortgage. Furthermore, a foreclosure that takes place after your chapter 7 cannot be reported on your credit report
12 May 2013
Customer reply
12 May 2013
What recourse do I have now? Regarding the truck? Just abandon it?
12 May 2013
Bankruptcy Lawyer's response
12 May 2013
FiveStarLaw
FiveStarLaw
Attorney
You may continue to use the truck until you no longer wish to continue using it. At that point you may abandon or give it to the lienholder. Another alternative would be to offer the lienholder a small amount of money to release the lien
12 May 2013
Customer reply
12 May 2013
Is there a formal way to do that? I.e. like looking on legal zoom.com for a specific form?
12 May 2013
Bankruptcy Lawyer's response
12 May 2013
FiveStarLaw
FiveStarLaw
DMV can provide the form to release a lien.
Customer rating:
FiveStarLaw
FiveStarLaw
Attorney
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12 May 2013
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