Offer to settle percentage

[Hobbies]

Ok, we filed Chap 7 at end of Jan., meeting of creditors Mar 9th., walk away from house with first and second mortgages , 50k in CC's. We have one car secured and will reafirm with bank. We have a travel trailer that is secured with a credit union and we would like to try and kept it. When and how do you talk with the creditor, would like to offer cash settlement base on a reduce percentage, or do a ride through with current loan. Was current till we filed and have not spoken to them since.

So with that here are a couple of questions:

What is a fair percentage to offer 20%, 30%, etc..............?

When is the right time to have this talk with the creditor?

Is any of the above a bad ideal and could cause problems in our Chapter 7.

Thanks

Hobbies

[AngelinaCatHub]

Ok, we filed Chap 7 at end of Jan., meeting of creditors Mar 9th., walk away from house with first and second mortgages , 50k in CC's. We have one car secured and will reafirm with bank. We have a travel trailer that is secured with a credit union and we would like to try and kept it. When and how do you talk with the creditor, would like to offer cash settlement base on a reduce percentage, or do a ride through with current loan. Was current till we filed and have not spoken to them since.

So with that here are a couple of questions:

What is a fair percentage to offer 20%, 30%, etc..............?

When is the right time to have this talk with the creditor?

Is any of the above a bad ideal and could cause problems in our Chapter 7.

Thanks

Hobbies

NO!!! Time is NOT right to talk or compromise with a creditor. It is too late and a trap. IF you pay one or two or all, it is preferential payment and will get your case dismissed.

You have filed and they are attempting to get half of something than all of nothing and at YOUR expense. DO NOT do business or talk to anyone and certainly do not sign anything and watch what you say on the phone.

Please read more "stickies" here about these things and C7. 'Hub

[BKParalegal]

Whoa slow down Hub.

You can file a motion to redeem under 722f and purchase a secured asset for fair market value. I do this with cars quite often. I got a 2008 chevy avalanche that the client owed $57k and redeemed it for $23,600.

Talk to your atty about this.

Good luck

[tcreegan]

Hi Hobbies,

Is any of the above a bad idea and could cause problems in our Chapter 7. .... "bad idea" and "causing problems" may not be birds of the same feather....

We have one car secured and will reafirm with the bank ...reaffirming is usually a bad idea, but doesn't really cause problems w/ the BK. Most people I see around here panic over losing their car and can't see that it is really [fecal matter] deal financially. Sometimes there is chunk of equity or really good loan terms to protect; then a reaffirmation might make sense.

But reaffirmations are strictly voluntary...the biggest problem seems to be getting it signed, filed, and approved before discharge. (good odds it doesn't get approved, be ready for that) If you need a reaffirmation hearing it might push your discharge date out a bit, but reaffirmation shouldn't be a problem to the BK.

a travel trailer that..like to try and kept it..Was current till we filed.. ....oops...if you want to keep it, keep current.

when do you talk with the creditor...to offer cash settlement This comes under 'cause problems' The trailer/car has been part of the BK estate since you filed. Anything you do has to go through the trustee until they are done with your case.

when do you talk with the creditor...do a ride through with current loan ...time to talk to your lender was before you filed. This is entirely up to the lender. Your attorney (or you if pro-se) should contact the lender and ask what they will do in your case.

Settling for a cash payment....like BKP said, you can redeem from the BK trustee for fair market value

If you have non-exempt equity, the trustee should be selling the asset. The lender gets paid, your exempt equity is paid to you, and the non-exempt equity gets distributed to your creditors. You can offer the trustee $$ in the amount of the non-exempt equity, the trustee can distribute cash and you get the asset. Saves them lots of time and trouble.

If you don't have any non-exempt equity, the car/travel trailer have no value to the BK estate and the trustee will file a report that they aren't going to do anything w/ the asset. Then it is up to you and your lender. If you offer a cash settlement, it won't come down to a percentage, it will be what the lender can get by repossessing vs what you offer to pay.

Last point to this long-winded post....the lender has restrictions on contacting you, so you need to contact them. If you are represented by an attorney, then you go through your attorney.

Good luck with it, hope you can work something out...

Tom in Colo