Weird Bankruptcy Case - Little Help Please

[fire228]

I filed Bankruptcy back in May 2012. Included in this was 3 credit cards, signature loan, a car and a motorcycle.
It was Discharged in July 2012

My car was picked up in Sept, but I still had the motorcycle. So I call Navy Federal Credit Union which is who the original loan was through and asked them when they planned on getting the bike because I had not ridden it in almost a year and no longer had insurance on it or anything because it was in the bankruptcy.

So Navy Federal tells me that that didnt file the proper lien paperwork before it was discharged and that they no longer had interest in the bike. Well just to get a better understanding of this and to hear it again, I call back 2 more times and talk to two different people. All tell me the same thing and say it's rare that this happens but sometimes it does and that the bike is basically mine to keep now. They even sent me a letter in the mail stating they no longer had interest in the bike.

So I call my lawyer and tell him and he had to contact the case Trustee. The trustee told me I could sell the bike and he would take a $3000 payment for it and I would keep the rest which would have been about $3000.

So I go try to get the title for the bike but Navy Federal was still on it as the lien holder, so I call them asking if they could send me some paperwork to release everything so I could get the title and they said that now they have an interest in the bike!! After all this they told me, now over a month later they completely reverse their story and want the bike!! So I asked if they would accept the $3000 instead of the trustee and they told me no, they want to come get it!!

So where do I stand?

If they didn't get all their stuff done to begin with how can they go back on all of this and reverse it and now take the bike?
Do I have a fight in this at all?

I'm lost........

[btbeme]

I say call the lawyer and tell him the new story. Let him and the Trustee work it out.

Anything you receive from this is a bonus.

[AngelinaCatHub]

If you have that letter admitting that they have no interest, you might try taking it down to DMV and see if it will lift the lien. If it does, keep the bike or sell it, whatever.

Second choice; charge the bank 3K for the storage. They now owe you from this point. Hey, it's worth a try, you are free and clear in any case. 'Hub

[Drazil65]

I would go to DMV to see how it is on paper, if no lien or lien not properly perfected then the bike is yours. Sell it I guess, why not at this point I am sure you could use some extra cash right? Or get insurance and ride it, your choice...

[tobee43]

was the lien discharged in your bk? your atty can file a motion to vacate the lien if you really want to push the issue and IF the credit union doesn't have the proper documentation, to present to the courts they are going to be SOL. while it might cost you to file a motion ...and i'm not really certain if the motion would be one to actually vacate the lien, it may be a different type, hopefully one of our resident attys may chime with the exact type of motion which may need to be filed. none the less, it can be done that way, you can push them against the wall legally and if they can't produce, they are going to have to give you the title, especially, if the amount was on the petition and there was nothing filed on their behalf. i'm certain your trustee would just love that! LOL!

[LadyInTheRed]

So I go try to get the title for the bike but Navy Federal was still on it as the lien holder,

It sounds to me like they do have a lien, even if somebody at Navy Federal made a mistake at some point and noted in their files that they didn't. The fact that they told you over the phone that the lien wasn't perfected doesn't make any difference. If they have a valid lien and payments weren't made as agreed, they can repossess the bike.

Do ask your attorney to be sure. But, I'd be really surprised if you are able to keep the bike or tranfer title to soembody else without paying off the original loan.

[fire228]

It sounds to me like they do have a lien, even if somebody at Navy Federal made a mistake at some point and noted in their files that they didn't. The fact that they told you over the phone that the lien wasn't perfected doesn't make any difference. If they have a valid lien and payments weren't made as agreed, they can repossess the bike.

Do ask your attorney to be sure. But, I'd be really surprised if you are able to keep the bike or tranfer title to soembody else without paying off the original loan.

The Supervisor of the Bankruptcy division for Navy Federal was the one that told me over the phone that the lien was never perfected and is also the one who sent me a letter stating all of this. I'm sure they should know what the hell they were talking about.

Just makes no sense that they didn't upload there end of everything yet they do a complete 180 after a month and now have a full different story!!

[LadyInTheRed]

The Supervisor of the Bankruptcy division for Navy Federal was the one that told me over the phone that the lien was never perfected and is also the one who sent me a letter stating all of this. I'm sure they should know what the hell they were talking about.

Just makes no sense that they didn't upload there end of everything yet they do a complete 180 after a month and now have a full different story!!

People make mistakes all the time. The Supervisor was probably just reading information off a computer that somebody mistakenly input. When you brought to their attention that there actually is a lien on title and asked them to release it, they looked more closely and found their mistake. Your only hope would be that the letter is somehow a valid release of the lien or that the lien can be invalidated becaue it wasn't perfected early enough. Invalidating the lien would probably require a court order. Let us know what your attorney says.

[joshuagraham]

This brings up an interesting question. Most (if not all) states have an exemption for a car. Could the car be a motorcycle instead?

[HHM]

This brings up an interesting question. Most (if not all) states have an exemption for a car. Could the car be a motorcycle instead?

That will be state specific, but I would say rarely unless you can prove it is your primary means of transportation, which is hard to do if you have both a car and a motorcycle. So, unless the exemption specifically provides for "motorcycle", the exemption will not automatically apply to a motorcycle. The debtor usually needs to make some affirmative showing that he bike is the debtor's primary (read, only) mode of transportation.

It will really come down to how the state words its exemptions and how the courts have applied the exemption in the motorcycle scenario.

The issue of OP is more a lien issue, the exemption really doesn't matter.