Will I get my title?

[kartoons19]

I had a car loan and two line of credits ($11K for both) with a local credit union. I paid off the remainder of the car loan last month and have been current with the line of credit payments until yesterday. I plan on filing ch 7 next month. The car is worth $3500 and will be exempt.

Given that the loans are through a credit union, I'm sure there is a cross collateralization clause, but need to verify. When I paid the car off they said it would take 30 days to get the title. I called last Wednesday, they said it would be mailed out and I will get it by Saturday, which I didn't. I called again yesterday and they said it went out Friday. Now here it is Tuesday, and I still haven't received it. This is a local credit union and it shouldn't take the mail this long. I'm concerned that now that I am late with the line of credit payments that they won't release the title. I'm wondering if I should make those payments or maybe it won't even matter since I still owe them money. Can they repo the car if I don't make the line of credit payments? If anyone has any suggestions, I would appreciate it. Thanks.

[Bell30656]

With the cross, yes they can repo the car. Will they? Probably not right now because you are not that far behind. If you file before getting the title, you most likely will not get that title. They may never come get the car but may keep the title forever.

Hey Kartoons... Can I buy your car? Now you can tell them the truth. Someone has expressed interest in buying your car and you need the title.

[Amadan]

yeah, I'd be interested in your car too if you can show me you have a clear title

Now you have 2 "interested buyers" for your car. They could be costing you money by making you wait any longer!

[newbie2]

Call back today. Ask which branch you should use to pick it up, as you have an interested party to purchase it. If they haven't mailed it as they said they did, their response will let you know that :-) Then if it is still there, go pick it up.

[StartingOver08]

Check to see if they have an electronic title. When I paid off my car loan, they just sent a letter thanking me for paying off the loan with a notation that they had released the lien and the title was recorded electronically. I had other debt with the CU that was discharged in the BK. However, in my reaffirmation agreement of the auto loan with the CU I had specifically removed the vehicle from the cross collateralization.

Speak to the BK dept of the CU. You might also try checking your DMV site to see if the title was released.

[kartoons19]

Thanks for your responses. I spoke to three different people at the CU about the title and not one of them mentioned cross collateralization or said I wouldn't get the title until the line of credits are paid off. Hopefully I'll get it in the mail today. If not they will get another call from me.

Bell and Amadan, I'll give you a great deal on my car! ;^)

[BCA2009]

If you pay off the loan and the line of credit is current ( or basically current as your case). They can't hold the title waiting for you to payoff the lines of credit under general cross collaterizations. You would have had to specifically used you vehicle as collateral as a secured line of credit.

If not, no one with credit cards or lines of credit with banks could ever sale or trade in vehicles.

I would stay on top of it though since it looks like you don't plan on making anymore payments, and I would get it resolved before I filed BK.

[kartoons19]

If you pay off the loan and the line of credit is current ( or basically current as your case). They can't hold the title waiting for you to payoff the lines of credit under general cross collaterizations. You would have had to specifically used you vehicle as collateral as a secured line of credit.

If not, no one with credit cards or lines of credit with banks could ever sale or trade in vehicles.

You make a great point. I'm feeling a little better about it. I was starting to think I would never get the title or worse, they would take the car. I don't need to go there!

If I need to pay the line of credit payments for this month to bring it current I will, but then I run the risk making a preferential payment since I will be filing soon. Hopefully I will get it in the mail today. If not I will call them and tell them I have a buyer for the car and want to pick up the title. Thanks again.

[kartoons19]

I think I'm going to have a hard time getting my title. I still haven't received it in the mail. I never even asked for the overdraft line of credits, they just gave them to me when I opened the accounts. But still I did use them once I lost my job and needed them to keep a roof over my head. Ironically one of the line of credits I didn't even get until two years after I financed the car! However, this probably doesn't matter because according to my car agreement it states "All collatoral which you pledge to the Credit Union to secure any specified obligation is security for all other obligations which you owe to the Credit Union past, present or future." They certainly cover all bases.

I wonder if I would have been better off to not pay it off prior to the BK and just reaffirm it. It would have been paid off in November anyway (I'm filing this month). Maybe I could have had them remove the cross col. in the negotiations. My attorney recommended I pay it off before the bk. It's a moot point now.

I am waiting for my attorney to get back to me about this. I will try to call them and say I have a buyer. My question is, if I am not able to get the title does this mean they can get the car at any time, even after the bk? Did I just throw away $900 that I gave them for the final payment? Outside of not be able to sell the car, what other downsides are there to not having the title. The car is 11 years old and in good shape. I just wanted to keep it for another 2 to 3 years until I can save up for a newer car. Why does everything have to be so difficult? TIA for your suggestions.

[BCA2009]

I still don't think you are going to have any problems getting the tittle based on the situation you have described. Go into a branch and tell them you need it. They should be able to give you a letter stating that the lien is released. You don't have to give them a reason. Be persistent. Have you checked wiht the DMV, Some banks may electronically send the release to the DMV and then the DMV sends you the title. It could takes weeks to actually get it. But the DMV should have a record that the title is clean.

[kartoons19]

I am so happy, I got my title today! The delay had absolutely nothing to do with cross-collaterization and everything to do wtih incompetency! They still hadn't mailed out the title, so I told them I wanted to come by and pick it up. It took two days to arrange it, but I picked it up today and I jumped for joy out of the building. So I am all set to file, just waiting on my attorney.

Thanks again for your help.