bankruptcy reaffirmations

Can a car loan company place a lien on my house when I am in bankruptcy?

My husband and I have filed chapter 7 bankruptcy, have already had the meeting of creditors, and are just waiting for it to be discharged. Originally, we were going to reaffirm the debt on my vehicle. We were a month late on the loan, and I called the loan company to work out a verbal payment arrangement. They were happy with that and sent the reaffirmation agreement to our attorney. In the meantime, we decided not to reaffirm the debt, thereby not making the payment we had agreed on. I called the lender and told them to come and pickup the vehicle. They said that the difference between what I owe and what they sell it for at auction will be non-collectable debt. (Note, we did not sign the reaffirmation papers). I got a letter in the mail shortly after stating something about them placing a lien on my house and I agreed to it with the security agreement when I purchased the car. When I bought the car, I lived at another house that I owned. Can they do this? What does this mean?

A bankruptcy proceeding supersedes any pending lien or other security agreement. You should get this letter in front of your attorney to file with the bankruptcy court to have this dismissed.. Bankruptcy means we are able to either wipe the slate clean and/or reorganize and pay some of the debts back..

The creditor is trying to be slick to get you in this predicament.. There is no contract, in my knowledge, of automobile contracts which allow them a security interest in any other real property besides the vehicle itself.. That would be like me going to buy a motorcycle, but now they are going to put a lien against my house.. I am not required to put my house up as collateral for a motorcycle purchase, and neither were you to purchase a car.. They are referencing a security agreement (but this only covers the car)..

The only times a lien can be perfected against a house is one of the following:

1 ) M&M lien (materials and mechanics lien — when a repair person come to fix something on your house or utilizes materials which you did not pay.

2) Tax lien – IRS or city/state related (property)

3) Judgment issued by a court

Have your bankruptcy attorney draft a communication to them advising they will be summoned in front of the bankruptcy court regarding their course of action.. Chances are the judge may sanction the creditor for trying to bypass the bankruptcy court’s procedure.. If they keep trying to go out at with you, have your attorney draft a complaint against the creditor for damages.

Hope that helps..

Reaffirmation Agreements in Consumer Bankruptcy Cases, Second Edition

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The first edition of Reaffirmation Agreements in Consumer Bankruptcy Cases addressed what to expect under the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 when consumer debtors want to reaffirm their debts. The financial crisis has since significantly altered the landscape for consumer debt reaffirmations, prompting renewed scrutiny by debtors, creditors and bankruptcy courts. T…

Bankruptcy: Implementation of Reform Act’s Debt Reaffirmation Agreement Provisions.: An article from: General Accounting Office Reports & Testimony

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This digital document is an article from General Accounting Office Reports & Testimony, published by Thomson Gale on January 1, 2008. The length of the article is 597 words. The page length shown above is based on a typical 300-word page. The article is delivered in HTML format and is available in your Amazon.com Digital Locker immediately after purchase. You can view it with any web browser.Citat…