We are half way through our Chapter 13 and have had no problems at all. One of our secured creditors was a credit union that held a Visa and 2 car payments, car payments not included in the 13, paid out of the plan, but the Visa was in the plan as secured debt with the 2 cars as cross-collateral on it. The Visa was paid in full early this month and the 2 cars have been paid in full (one last October and the other this past July). The Visa also was paid with a 6% interest and was set up this way by the trustee (it originally had a 13.9% interest rate). So I found an old passbook account we held with the credit union with $100 balance in it and called the credit union to w/d and close it out and to see when they will send my car title. They will not close it for they said we still owe $1000 on the visa for the difference between the 13.9% interest rate and the 6% that the trustee approved and was in our docket report and on our BK papers! They are also holding our paid off car title for the extra money they say we owe! My lawyer is furious. My question is can they go back and do this? It is shown in our bk account that they have a 0 balance due to them. My lawyer said credit unions are notorious for stuff like this.
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I don't know the answer but I am very interested in finding out. Our mortgage is with the same credit union that 2 of our unsecured credit cards were at along with our second that is being stripped. Does this mean that after we are discharged they can force us to pay the two credit cards and the LoC? I hope someone here will respond with some info for us both. If your lawyer is angry then I would hope it's because this sort of behavior is not allowed and he will know what to do. What was his response to you?Filed Ch 13 Feb 9, 2012, 341 meeting Mar 15, 2012, Confirmed Apr 5, 2012
Anticipated freedom party Apr 2015
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Ugh. I have no idea but seeing this fills me with dread. Bwe just completed our plan and are waiting for discharge. We lien stripped our two credit union car loans, and walked Way from our house with 2nd also with the credit union and also a credit card from them. I need to call them to vet out titles and are preparing for a battle... will be watching this thread!!
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Originally posted by kmjatl View PostJust taking a wild guess here...
Is that $1000 considered debt until it is discharged on completion of the plan?Filed Chapter 13 - 07/20/12
Discharged 8/2/16
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Originally posted by sophieanne View PostThat was the first thing I asked myself to when I read this post...until the debt is discharged, it's still the debt. Once the discharge happens the debt goes from $1000 to zero.
Warmbloodmom, welcome to the forum. I have no real insights for you at this time. We were an Asset Ch7 case. How some of these things are handled during and after a CH13 will have to wait for someone with Ch13 experience.
I will say that we also were dealing with a CU. Credit Unions are difficult because they are a collection of members that pool their monetary resources for the good of all of the membership. So when any one member has a problem, such as a BK, it is considered damaging to the well-being of the other members.
When our 'Suggestion of Bankruptcy' went out, we promptly got a nastygram from our CU informing us that they were closing our account. This even though we had notified them ahead of time. 'Hub had been a member of this CU since 1964 and wished to remain with them.
We had a car loan with them that was about 10 months away from being paid off. We also had an overdraft protection account with them. We had to reaffirm those in order to remain with them.
There was also a CC that 'Hub had gotten through the CU, but wasn't owned by the CU, so there was no cross-collateralization. That card had about 36K owed on it, and we had a Sears card with about 6K on it. Those two cards were owned by the same company. There is an interesting story about that, but it has nothing to do with the CU issue."To go bravely forward is to invite a miracle."
"Worry is the darkroom where negatives are formed."
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Actually, I don't think there is a $1,000 debt to be discharged. It's different than an unsecured debt or a secured debt being discharged in a 7. The interest rate was reduced to the "Till" rate under the plan. Once the loan is paid at the reduced interest rate, I think the lender needs to turn over the title.
warmbloodmom, it sounds like you have a good attorney and that he thinks they can't do what they are doing. It just may take some time to deal with.LadyInTheRed is in the black!
Filed Chap 13 April 2010. Discharged May 2015.
$143,000 in debt discharged for $36,500, including attorneys fees. Money well spent!
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[QUOTE=AngelinaCat;606306]Actually that isn't quite so. The debt remains, but once discharged, the debtor is no longer under any legal obligation to pay it.
Hi AC...i think i was saying the same thing...only not the correct wording. And in fact, my vehicle was paid off after 6 months in my plan and the title returned to me. The bank told me that the $100 owing (difference from what the interest rate was versus what the trustee said the interest would be) on it would have to be paid if my case was dismissed otherwise when the discharge occured there would be no obligation.
Sometimes I think we get too tehnical in our explanations.
LIR - again, until the case is discharged, the bank/credit union will accumulate the difference in the interest rate paid (per the plan) versus the interest rate of the original loan. If it is a small amount (like in my case), they may turn the title back; if it is a larger amount, they can hold the title until discharge. This is for their protection in case the case is dismissed. If anyone doesn't agree, please contact your attorney.Last edited by sophieanne; 08-22-2013, 08:45 AM.Filed Chapter 13 - 07/20/12
Discharged 8/2/16
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This is a very interesting case and I'm sure it would be much better to hear from your own attorney! I would say that until the debt is actually discharged, there could be issues. Remember, while a Chapter 13 is in progress, the clock stops but interest still accumulates JUST IN CASE your case is dismissed or doesn't obtain a discharge. Secured debt is a little special in that it is a fixed amount and once paid, the title should be clear (unless there was a cramdown).
My guess is that this could go either way. I'm leaning to the idea that the debt (secured cards and vehicle) was paid and that the debt does not need to wait for discharge. The problem may be in whether the credit cards are actually "secured" debt on Schedule D!Last edited by justbroke; 08-22-2013, 05:53 PM.Chapter 7 (No Asset/Non-Consumer) Filed (Pro Se) 7/08 (converted from Chapter 13 - 2/10)
Status: (Auto) Discharged and Closed! 5/10
Visit My BKForum Blog: justbroke's Blog
Any advice provided is not legal advice, but simply the musings of a fellow bankrupt.
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Originally posted by warmbloodmom View PostYes, the credit card was "secured debt" on Schedule DChapter 7 (No Asset/Non-Consumer) Filed (Pro Se) 7/08 (converted from Chapter 13 - 2/10)
Status: (Auto) Discharged and Closed! 5/10
Visit My BKForum Blog: justbroke's Blog
Any advice provided is not legal advice, but simply the musings of a fellow bankrupt.
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