CH7 Vehicle in repo status..surrender?

[17CharleyCo]

Hi all, I'm THIS close to filing and a repo man visited my home for my vehicle recently while I was gone. I'm hesitant to surrender the vehicle as I'd like to keep it and get current. Our original intent was to surrender the vehicle but we really need it now since our other paid off vehicle has broken down. Any advice on what to do here? Just duck and dodge the repo man or call to notify the lender?

[justbroke]

What is your real plan with the Chapter 7? A Chapter 7 won't solve your arrears on the vehicle. After filing, the lender will likely file a motion for relief from stay (RFS) and seek to recover the vehicle. There are so many different laws regarding repossession in different States that I can't comment on what could happen if it is repossessed and you did file shortly thereafter (e.g. could you actually get it back based on your State's non-bankruptcy laws).

My only advice is that you need to have a real plan. You need to make this a financial decision. You will need to run the numbers... and answer the question of whether keeping that vehicle is worth it in the long run. The Chapter 7 would give you some pause (keep the lender at bay) but not for long.

Can you redeem the vehicle in the Chapter 7? Can you actually catch up on payments within 30-60 days (after filing)? Are you underwater with the vehicle? (They are all financial questions.)

[17CharleyCo]

I'm definitely underwater with the vehicle and if I need to catch up 30-60 days after filing then I'm not in a position to keep it.

[justbroke]

I'm definitely underwater with the vehicle and if I need to catch up 30-60 days after filing then I'm not in a position to keep it.

Why not look at redemption via a 722 redemption loan (named for the section of the bankruptcy code which allows one to redeem certain property for it current market value).

If you're filing Pro Se, it can be a little intimidating to do a redemption by yourself, but you need to know up front if you're going to keep the vehicle. If so, you may want to start planning to redeem when the value is less than what you owe.

[SeekingZero]

This is just my personal experience-it is not legal advice. I made the financial decision to file the CH7 soon, after my wife and I separated. It was not a difficult decision, it was what was needed to be done to survive. My atty advised me to stop making all the payments on all my debt except the mortgage and student loan, since I always planned on keeping the house and the student loan isn't getting discharged. So I stopped making my car payment after I met with him. 3 weeks later I filed, and the automatic stay went into effect. I've been driving it without any payments, free if you will, for the last few months. Keeping the insurance current of course. They haven't taken any action as of yet to repo it sooner. I don't know why. In a few weeks I should get the discharge, and assume shortly after that it will be repossessed. I knew I wasn't ever going to keep this vehicle, even if I could redeem it, and only pay what it was worth, since that is still more than I could afford now.

I did have a friend that actually owed very little on a car with also very little value. After his discharge they didn't even bother to repossess it. I don't know why.

I would think, but can't say for sure, that you would at least have a few months to figure out what you need to do after filing. The calls will stop immediately, lenders really don't seem to want to break the rules when it comes to that. which is good, gave me some breathing room. Thank god that was the case for me. Again, not advice just my personal experience. Others on this board have told me that I may or may not get notice of when they will come to repo it. I hope they do, so I have at least some time to figure out how to get another car. If not, i'll just get a ride, and go rent the cheapest car at hertz until I can buy one.

Oh- usually a bankruptcy attorney will meet with you for free, and possibly answer many of the questions you have. I felt much better after that initial meeting.

[LadyInTheRed]

They haven't taken any action as of yet to repo it sooner. I don't know why.

They would have to file a motion for relief from automatic stay to do that. Not many lenders will bother doing that for a car. They would rather save the cost of filing the motion and wait for your discharge.

Your friend's car probably wasn't repossessed because the lender decided that the value was not worth the cost of repossession and auction.

[SeekingZero]

They would have to file a motion for relief from automatic stay to do that. Not many lenders will bother doing that for a car. They would rather save the cost of filing the motion and wait for your discharge.

Your friend's car probably wasn't repossessed because the lender decided that the value was not worth the cost of repossession and auction.

How soon after the discharge would be typical for them to come take possession? Would they notify you? I keep it garaged when home, so a night time repo is not likely.

[LadyInTheRed]

How soon after the discharge would be typical for them to come take possession? Would they notify you? I keep it garaged when home, so a night time repo is not likely.

I have no idea what is typical. They can repo it any time after discharge. If you keep it garaged, they are going to have to notify you. They can't break into to get it.

[SeekingZero]

I have no idea what is typical. They can repo it any time after discharge. If you keep it garaged, they are going to have to notify you. They can't break into to get it.

Thanks! I'm about 3 weeks from my discharge, haven't heard a thing from the auto lender. if I don't hear from them after the discharge, should I call them to make arrangements? give them a few weeks? Its interesting that their doesn't seem to be a procedure that all auto lenders follow.

[zmoney]

Thanks! I'm about 3 weeks from my discharge, haven't heard a thing from the auto lender. if I don't hear from them after the discharge, should I call them to make arrangements? give them a few weeks? Its interesting that their doesn't seem to be a procedure that all auto lenders follow.

I know this is an older post, but letting you know my experience. I am in an active Chapter 7, have had my 341 meeting, no discharge yet. No assets case. My vehicle which was not reaffirmed was in danger of being repossessed even before discharge.

During my filing, my lawyers had me sign an "intent to pay" to keep paying on my vehicle. I missed one payment, and the Automatic Stay was lifted, well, automatically since I defaulted on the agreement of "intent to pay". Lawyers sometimes do this "intent to pay" agreement to see what action the lender will take, which sometimes the lender will let you keep the vehicle as long as you keep making timely payments.

Also, sometimes you can call the lender directly and try to renegotiate terms on your loan for a lower balance or interest rate once your case has been filed. Legally, they cannot call you to make arrangements, since after filing lenders are required to cease all collection attempts, but you can call them. By the way, I learned this trick from ClarkHoward's radio show, but it may be different in some states. (My lender wouldn't budge though)

That being said, if I had continued to make payments as agreed, my lender would not have repossessed my vehicle, and it makes sense. The lender is collecting money on a discharge-able vehicle, so it is in their best interest not to repossess unless they think you are going to stop making payments. Repossessions are costly, and in many cases you can keep paying on your vehicle post discharge until you are ready to purchase another vehicle.