Filing a Motion to Object to Proof of Claim

[hopeforusall]

I am a Pro Se Chapter 13 filer. I have been to my creditor's meeting. It went well and I got the letter from my Trustee recommending my plan for confirmation. The day after my creditor's meeting I lost my job. I am needing to file an amended plan for reduced payments along with revised schedule I & J. That part I can handle. My biggest issue is I need to file an Objection to a Claim. One of my creditor's has filed a proof of claim saying they are secured but they are not. I've been told I need to file a motion and the clerk of court (Florida) told me there is no specific form that I just need to make up one. Can someone explain to me the motion process and what my motion needs to say. Do I go into detail on it as to why they are not secured or do I just say I am objecting? I understand I need to file this motion with the court and send a copy to the creditor and the Trustee. Also, does anyone know the time frame for being able to object to proof of claim filed by a creditor?

[justbroke]

One of my creditor's has filed a proof of claim saying they are secured but they are not. I've been told I need to file a motion and the clerk of court (Florida) told me there is no specific form that I just need to make up one.

I'm surprised the clerk went that far, but anyhow, it's not a motion. It's an Objection To Claim.

Can someone explain to me the motion process and what my motion needs to say. Do I go into detail on it as to why they are not secured or do I just say I am objecting? I understand I need to file this motion with the court and send a copy to the creditor and the Trustee. Also, does anyone know the time frame for being able to object to proof of claim filed by a creditor?

First, I would go to the Court's "calendar" and search on "Objection to Claim". Then look up a case or two in PACER and look at what's in an Objection.

How do you know they are not secured? Do you have the original "agreement" or "contract" to attach as an exhibit to your Objection?

I can't teach you how to file an objection because you need to state a legal basis for your objection and why you should be granted the request relief (your objection should ask for some relief... like denying the claim).

There is a standard format for "papers" in the U.S. Bankruptcy Courts. Looking at some objections to claims in PACER will help you with format.

I cant' go much further... do you have the NoLo Press Chapter 13 Bankruptcy guide? If you don't... you should get it yesterday. It includes some general guidelines on many things, including Objections to Claims.

[hopeforusall]

This is the situation with the "secured" loan. I received a live check in the mail for 5K in 2007 and by cashing an unsecured loan was created. Then another loan company took over that portfolio. I continued to make monthly payments to the new company up until 2009. Then in Feb 2009 the loan company called me up and said they had good news for me that I didn't need to make my loan payment for a couple months as they were going to put the loan officially in their name with new paperwork. They said everything was staying the same the balance and the interest rate. I went in and signed the paperwork one day on my lunch break. The loan officer quickly pushed each page of the loan document in my face to sign. I looked closely at the terms and they were the same. However, I didn't noticed, nor was it pointed out to me the details on one of the pages I signed. A month or so later when it was getting closer to making my first payment on this "new" loan, I was looking over the loan documentation and I noticed a page that looked to be securing the loan with specific household property and a value attached of 3500. for these two items, a plasma tv and notebook. I called up my loan officer immediately and said, what are these items on my loan I don't own that property. He said, "that is just something we do" I said well I thought you had someone else's stuff on my loan and was confused. He said again "that is just something we do". I said, so this loan is unsecured right? and he said "yes, we would get a car title if we were going to secure a loan and if you default we have nothing to come after." Then flash forward a couple months when I file bankruptcy, I check pacer for the claims that have been filed and they slipped 3500. of the loan through as secured. I was shocked. I haven't called them as I don't think that would be appropriate to call, but need to file the objection.

[justbroke]

Unfortunately, it's secured. They duped you. Since you are pro se, I don't really want to instruct you on what to do, but in that case, you may want to file a Motion to Determine Secured Status (if the Objection to Claim doesn't work out).

The problem is... you signed the loan documents. (I just had to say that. Now let's work on what it all means...)

Check your loan paperwork. Is the first page (of the Agreement) stamped with a "documentary stamp" or "documentary tax"? If so, it's probably secured and a "lien" was recorded on a UCC-1 (Uniform Commercial Code) in a secured transaction registry.

Generally those types of loans, issued by the likes of CitiFinancial, EquityOne, and Beneficial, to name a few of these scum... are actually secured. The problem is whether they actually recorded the chattel (loan documents) with the State's registry. Usually this is done on a UCC-1 or a form that complies with that. In Florida, as an example, there's a statewide Registry for these types of secured transactions which is publicly searchable. Perhaps you could see if your State has one and you can search it to see if a UCC-1 was recorded.

Again, while I can't tell you what to do, I would be inclined to file an Objection to Claim and make all the statements as to why it's not secured. You can't point to the Agreement and say "I signed it, but I didn't read it"! Ignorance is no excuse. Hopefully you would have checked with your State's (or County's) recorder of chattels and determined if it was a properly executed lien.

Generally speaking, and if you read the fine print on the Loan Agreement, it probably mentions that even if they specify "laptop" and "Plasma TV" it means "any computer" and "any television" as its by a class of property securing the loan.

I feel like I'm repeating myself, but the first thing you need to do is review the loan agreement (look for documentary stamp). Second, check the State/County's recorder of chattels via the secured transaction registry or other source for UCC-1s in your State/County. Third, write your Objection based on that information.

I must add that a properly recorded lien is hard to beat. You may have to move to Avoid the lien (by filing a Motion to Avoid Lien) if the lien impairs some exemption. (For one computer you may be able to do this. I think for one television too, but it may be more in your State.) There is a lot of work on your part to do. They may just go away with the Objection and you may get it sustained. I would probably be inclined to, in a Motion to Avoid Lien, bring up that the lender didn't give any new consideration (terms the same, no more funds) but then added this security provision. Hopefully you have your old loan documents or can subpoena them. This could get complex for a pro se filer.

[hopeforusall]

I do not see any stamp on my copy of the loan document but I will need to pull up the pacer document they submitted and see if they stuck it on there. On the very top where it asks for date, account number and Type of Loan. In "type of loan" they have E00

As to the page of the loan document in question it is called a Personal Property Appraisal Form. Directly underneath that heading it says the following:
(These are the only acceptable items to used as personal property security. DO NOT USE ANY OTHER ITEMS. If I/we have selected personal property insurance, the items described in Schedule A and B with a replacement value* are covered by insurance. Business Property or Equipment cannot be included as security.

Schedule A
Item Size Replacement Value
Desktop/Labtop Computer HP Notebook 2000
Television (Secondary) 42 Sony Flat Screen 1500

(Insurable Amount)
Schedule A Replacement Value* Total $3500.


*Cash Value in TN only.

Schedule B & C are blank

Bottom of page says:

I(We) hereby affirm that the items listed on this Personal Property Appraisel Form are owned by me (us), are not used in any way in my (our) employment, are not essential for my (our) welfare, and that the total replacement value of insurance goods used as security on this credit transaction is $3500.

And then I signed the bottom of the form.

A couple of questions I have. Let's say I chose to surrendor the factitious collateral that they created. What is it they are going to get? A Sony flatscreen T.V. with no model or serial number? An HP notebook they said I have with no serial number or model #? It seems that since it was a falsified document that was signed and I pointed it out to them when discovered and they responded by saying it wasn't really secured that I should have good cause for objection.

[hopeforusall]

I re-read your response and noticed that you referred to Equity One, that is the company the loan originated with. And in looking back over my documents for this original loan just now, I see that it does have the stamp that you referred to with a registration no. However, as stated above, I did not see a stamp on the documentation with the new loan and loan company.

[justbroke]

Personally speaking... I don't think they have a valid lien. While I wont' tell you what to do directly... I would be inclined to file an Objection to Claim and note that they have an unenforceable lien (11 USC 502(b)(1)), that the debt is not secured by any property and that the claim should be disallowed.

You have no defense to having signed that document. However, I think you can challenge whether the lien is valid and that the lien was properly recorded.