Auto deficiency balance lawsuit question

[Stilltheone]

Hi all!

Our vehicle got repossessed in August of this year and we just received a letter that it was sold and that our creditor's attorney plans on suing us for the deficiency balance ($3087) The vehicle was included in BK, but we signed a reaffirmation agreement.

In our state (WI), we are protected from any type of wage garnishment because we are on food stamps. I spoke with the creditor this morning and informed her as such. She said to forward on our food stamp approval letter and she would give it to the attorney.

She also said that they would continue with their attempts to sue me and they would get a judgement against me. Since we are protected from wage garnishment, she said they would just put a lien on my house and that if we ever "sell the house", this lien would have to be paid off first.

Here's my question: If we would ever choose to let the house go into foreclosure (we are upside down by $60K and it was included in BK over 2 years ago---no reaffirmation agreement signed), what happens to that lien that the creditor put on our house?

[tobee43]

usually any liens against the property would be passed to the new owners to clear title when they make the purchase of your foreclosed house.

however, in this situation this is post bk and i'm not certain exactly what they can do at that point...so i guess i NO help!!!

[tobee43]

actually, they most likely can take other measures to collection the judgment...however, i 'm not certain they can transfer a lien once they have done it.....interesting....

[Stilltheone]

Interesting...So,once they put the lien on the house, if we would walk away, they can't continue to "come after us" with a wage garnishment?

Like I said, we are protected, for now. But, once we get off of food stamps, we still have 6 months afterwards to be "protected". Once that 6 month mark is over, they can go after us for a wage garnishment.

How likely is it that my mortgage company will find out if there is a lien on the house? If they do, would they do anything?

[tobee43]

Interesting...So,once they put the lien on the house, if we would walk away, they can't continue to "come after us" with a wage garnishment?

Like I said, we are protected, for now. But, once we get off of food stamps, we still have 6 months afterwards to be "protected". Once that 6 month mark is over, they can go after us for a wage garnishment.

How likely is it that my mortgage company will find out if there is a lien on the house? If they do, would they do anything?

if the judgment was granted and the lien filed ....believe me the bank knows and IF they don't....the creditor will do a title search and find it.

so, yes, sorry...they may be able to move the judgment if they put the lien against your house......OR...<PERK> you need to find out if they can "move" the judgment and apply it elsewhere...some states once the lien is in place there's no removing it and the creditor brought it hook, line and sinker...could be true..i hope for you!

[SunshineGal]

Because the lender is in first lien position, they wouldn't have to pay the lien off unless they got enough money to cover it. If the judgment remains unsatisfied, it will stay on your public record and will need to be paid prior to buying another house.

[SweetGeorgia]

In the meantime, they will go after your bank accounts. Make sure you don't have much in there (and not more than you can afford to lose).

[tobee43]

In the meantime, they will go after your bank accounts. Make sure you don't have much in there (and not more than you can afford to lose).

yes, they are usually nasty!! however, there are SOME states that once a creditor has put a lien against the house...they can't remove it and go after you in another way....in other words..they can't get 20 liens for the same judgment.

personally, i would check with your atty. i know in the state i USE to live they couldn't once they put a lien against a home...they brought it hook, line and sinker...they couldn't do a wage garnish with the lien still sitting on the house.

[AngelinaCatHub]

The lien goes with the house. The Judgment goes with you. If you are fortunate to have the Judgment satisfied if/when the house is sold, your Judgment has been satisfied. If the Judgment does not get satisfied or for some reason the lien is set aside, they can go after you some more.

In our state FL they cannot garnish up to $500 of the head of household income. Check your state exemptions on Judgment collection.


Here is an example, we had a $1200 Judgment against a person who attempted theft of my Mother's estate. We levied on her car, had it sold at auction, purchased it for a net of $700 but the car was worth $6500. After expenses, only $8 dollars of the Judgment was satisfied, so in theory we could do it again, and again, until our Judgment is satisfied. We in practice just let it go as our "pound of flesh" was satisfied. We drove the car for four years. 'Hub

[tobee43]

The lien goes with the house. The Judgment goes with you. If you are fortunate to have the Judgment satisfied if/when the house is sold, your Judgment has been satisfied. If the Judgment does not get satisfied or for some reason the lien is set aside, they can go after you some more.

In our state FL they cannot garnish up to $500 of the head of household income. Check your state exemptions on Judgment collection.


Here is an example, we had a $1200 Judgment against a person who attempted theft of my Mother's estate. We levied on her car, had it sold at auction, purchased it for a net of $700 but the car was worth $6500. After expenses, only $8 dollars of the Judgment was satisfied, so in theory we could do it again, and again, until our Judgment is satisfied. We in practice just let it go as our "pound of flesh" was satisfied. We drove the car for four years. 'Hub

Check your state exemptions on Judgment collection.

this is the KEY factor in determining what your next step should be...it is apparently just by what has been posted, that is varies from state to state with respect to to judgments.

[Stilltheone]

Credior FINALLY filed against husband and I on Monday. Still haven't been served, but court date is scheduled for Dec. 2.

QUESTION---

How are they going to go after my bank account? What do I do? I NEED a bank account.

[tobee43]

Credior FINALLY filed against husband and I on Monday. Still haven't been served, but court date is scheduled for Dec. 2.

QUESTION---

How are they going to go after my bank account? What do I do? I NEED a bank account.

it will depend on how quickly the court will grant the order to attach to your account. unfortunately, it's usually quick.

don't keep anything in the bank...use money orders and cash...or they will keep attaching when they can, if they chose to go that route...since they cannot go for a wage garnish...it may be in your best interest to do this...or at least this is what i would personally do, if i were in your situation.

i would go to the dec2 court date...explain your situation to the judge and say...judge..we have nothing...filed bk..i can pay these snakes $50 a month...is that ok?? please...and cry, be sincere...and show the judge you bk etc.

many times the judge will ask the creditor to work with you under the circumstances...anyway...that is what I WOULD do...only if I WERE YOU...

best of luck! sorry this is happening to you..

[Stilltheone]

UPDATE---

My mom stepped in and decided to take out a loan to pay this creditor off for me. She didn't want a lien on our house because our mortgage companies are a bunch of jerks. So, my mom stepped in and saved the day. Went and paid it off in full yesterday and am just waiting for the dismissal from the courts.