Cross Collateralization Question

[magua2]

US Bank has my car loan. $5k exemption in vehicle and I have about $5k equity in the car.
US Bank also has my business credit card and my personal credit line, I think it is called a "Premiere Line of Credit." Total on these is around $20k. I don't plan on reaffirming any of the loans, but I will stay and pay with the car.

My state doesn't allow repo's unless there is a late payment. However when I stop paying the credit cards and/or receive a discharge, can US Bank take the car through cross-collateralization?

[despritfreya]

I would be very surprised if there is a cross collateralization clause for any of your obligations to US Bank. Certainly not for a credit card that is a VISA type card. Cross collateralization clauses (which are enforceable) are more likely found when dealing with a credit union or, when dealing with a large lender, where commercial real estate is involved.

To be sure, pull your Premiere Line of Credit loan documents and review them carefully.

Des.

[btbeme]

Doubtful, as Des says, but check.

Just as important is to stay in touch with your auto loan as you move through filing and go towards discharge and the Afterlife. Make sure your payments go to the right place (likely to change after you file) and are being properly credited (may be difficult as your access to online systems, monthly statements, etc will be limited if not altogether closed off). Keep hard copies of your cancelled checks.

After filing, when you call on your auto loan, you will likely be routed to their BK department, who can then tell you where to send your "voluntary" payments. Don't be surprised if they insist on a reaffirmation. If you are absolutely sure of your intent and ability to pay, then seriously consider the reaffirmation. Without one, it is getting more common that auto loan companies ask for a lift of stay or aggressively pursue a repo immediately after discharge. Good communication is important, but be aware that the company has policies that the phone drones cannot change. I received a repo notice two months after paying off an auto loan, six weeks after discharge, and after I had the payoff notice and title in my hand. Sometimes the left cubicle does not know what the right cubicle is doing.