Discharged but what about my car??

[Jester1]

Need help....

My BK was final about three weeks ago, filed in March.

About a year ago I put the title to my 98 GT Convertible up for collateral on a loan with Citifinancial to pay off a doctor's bill. The car is a project car that I owned--I have a 2008 Honda that I kept through the BK.

I never heard from Citifinancial about the GT throughout the process, and now that the BK is finalized, what do I do?

Can I now keep the car (I'll just a new title) or will they come after me at some point to try to get it?

Not quite sure what to do, and now that I've finished the car I'd like to sell it to pay off my Honda.

thanks in advance for any help!!

[lrprn]

About a year ago I put the title to my 98 GT Convertible up for collateral on a loan with Citifinancial to pay off a doctor's bill. ... I never heard from Citifinancial about the GT throughout the process, and now that the BK is finalized, what do I do?

Some questions first....

Did you still owe on the loan when you filed or was it paid off so you didn't have to include Citifinancial on your creditor list?

If the loan wasn't paid off, did you list the loan as secured by the GT when you filed in March?

Did you sign a reaffirmation agreement to repay the loan that was filed with your local bk court?

Who has the title to the car now?

We can't address your other questions without knowing the answers to these first.

[AngelinaCat]

Hi Jester1, welcome to the Forum.

I have several questions I need to ask before I, or anyone else, can give you any sort of answers.

First, what is this 'project car' and how much is/was it worth? If it was a collection of bolts--probably not much--but it would help to know.

Second, did you list this in your bankruptcy? If so, what was the value?

Third, you used the title as collateral for Citifinancial--were they included in the Discharge Order? If they were, then you should be okay.

The reason I ask all these questions is because my DH, AngelinaCatHub and I had an old car that at the time we bought it, 2002, was a fixer-upper. Then, we had lawsuits in 2003, hurricanes and prostate cancer in 2004, and more &))%$ until Dec. 28, 2007, when we filed. The car sat in the garage for more than four years. We had to produce the title for it and answer questions about its conditions--on a scale of from 'showroom quality to housing squirrels' where was it? I answered truthfully that we were not housing squirrels, but that it had not moved in four years, and the green color on the surface was NOT the paint, but mold. We also invited him to come see it.

The trustee officially 'Abandoned Interest' in the car, and after our Discharge, we sold it earlier this year to raise some money. We are not closed yet, but sure are hurting, so I can sympathize.

I hope this helps. Good luck.

[Bell30656]

I had a conversion van listed in my bankruptcy. The lien holder knows where I live, after all it was on all the paperwork... But to date Big Bertha sits out in the driveway. I drive it on occasion and I've kept the plates renewed.

I fully expect to come home one day to find an extra parking place. I know I'll never get a title for it but if it is still there in a few more months I may start driving it again.

[Jester1]

Thank you all for such a quick response, it's greatly appreciated!!

See below for answers to your questions, hopefully there's enough information to assist you in answering my question:

Did you still owe on the loan when you filed or was it paid off so you didn't have to include Citifinancial on your creditor list?

*** I still owed about $2100 on the loan when I filed.

If the loan wasn't paid off, did you list the loan as secured by the GT when you filed in March?

*** I believe I did, though at the moment I'm not 100% sure.

Did you sign a reaffirmation agreement to repay the loan that was filed with your local bk court?

*** No, the only thing I reaffirmed was my Honda.

Who has the title to the car now?

*** Citifinancial still has it as I had to surrender it when I obtained the loan.

First, what is this 'project car' and how much is/was it worth? If it was a collection of bolts--probably not much--but it would help to know.

*** I bought the Mustang to play with (Performance mods, etc.-- reliving my childhood I think). I paid $8k for it five years ago, current retail value is about $7000.

Second, did you list this in your bankruptcy? If so, what was the value?

*** I don't recall at the moment if I listed it seperately, though I know I made it known that the loan was secured by the title.

Third, you used the title as collateral for Citifinancial--were they included in the Discharge Order? If they were, then you should be okay.

*** Yes, I used the car as collateral to obtain the loan, and that obligation was listed in the documentation.

[Jester1]

Also, if they filed a lien (I don't know if they did or not), how does that work? Does the lien only allow them to be a co-owner since the loan balance was $2500 and the car is worth $7,000?

If they only get part, if I sell it then I would have to pay them the balance on the loan before they would release their ownership, correct?

Can they come and get the car? If they do and sell it, would they need me to release my share before it could be sold? If they take it and sell it for $5,000, would they get their $2500 and I would get the rest?

I'm just worried that if they come and get it I'll get nothing (assuming a lien has been placed). I will sell it ASAP if it will ensure that I'd get back the balance after paying the loan amount.

[justbroke]

Also, if they filed a lien (I don't know if they did or not), how does that work? Does the lien only allow them to be a co-owner since the loan balance was $2500 and the car is worth $7,000?

You should immediately go check with the Registry of Motor Vehicles, Division of Highway and Motor Vehicle Safety, or whatever they call it in your area. You should do a title check. Please note, in some States (hurray for Florida!), you can do lien checks on-line for free! If they didn't record a lien, then they do not have any rights to that title and the debt was discharged!

If they only get part, if I sell it then I would have to pay them the balance on the loan before they would release their ownership, correct?

Not unless they have a valid recorded lien. Liens for pre-petition debt must be recorded withing a.) so many days of the transaction, and b.) before you file for a Bankruptcy.

Can they come and get the car? If they do and sell it, would they need me to release my share before it could be sold? If they take it and sell it for $5,000, would they get their $2500 and I would get the rest?

Again, I would check who really has title to that car! I'm guessing, because CitiFinancial is really bad at this, that they never recorded a lien.

If you find no recorded lien with your appropriate Registry of Motor Vehicles, I would have your lawyer send a nice letter demanding that they turn over the title immediately.

That's my read, at least.

[Jester1]

Not unless they have a valid recorded lien. Liens for pre-petition debt must be recorded withing a.) so many days of the transaction, and b.) before you file for a Bankruptcy.

Thanks for your reply! All made sense except this part.

If they did file a lien (I will check, thanks), you're saying that they needed to file something as part of the bankruptcy process to keep the lien valid?

Is there a way to find this out without knocking on CitiFinancial's door?

I'm sorry for this not sinking in......

J.

[justbroke]

Not unless they have a valid recorded lien. Liens for pre-petition debt must be recorded withing a.) so many days of the transaction, and b.) before you file for a Bankruptcy.

Just saying that they should have recorded the lien on the vehicle within 30 days of you getting the loan... and before you filed for Bankruptcy. Once you filed Bankruptcy, that pretty much stayed them from recording a loan, so if they didn't do it... they are toast.

If they did file a lien (I will check, thanks), you're saying that they needed to file something as part of the bankruptcy process to keep the lien valid?

No.

Liens Survive Bankruptcy.

I repeat, liens survive bankruptcy. The only way to strip a lien, is to actually file a motion to avoid the lien, while your case is open. A creditor who had a valid lien before filing, can always seek to repossess the collateral for that loan if it's not paid or you are behind in payments.

(There are some exceptions to liens surviving, but as I wrote, liens need to be "avoided" through a process within the Bankruptcy.)

Is there a way to find this out without knocking on CitiFinancial's door?

Yes... call the DMV (or Registry) and find out if there is a recorded lien. You only need the VIN number to do it. It's quick, simple, and painless.