Right to cure

I am filing pro se and my 341 meeting is April 3. My question is one of my creditors "Nebraska Furniture Mart" just sent me a letter wanting to reaffirm my account with them, they are stating that they have a purchase money security interest in the mechandise that I bought from them in 2007. If I am filing chap 7 doesnt that resolve me of owing them anything including giving them back the property that is 2 years old? If I dont reaffirm with them or give them back the property they will send a right to cure letter post discharge. Help please!

Technically, they have the right tor repossess the property. The BK discharges your "personal obligation" to pay the debt, but the furniture store maintains their lien.

HOWEVER, as a practical matter, furniture lenders and the like, almost never retake the furniture; the steps they would have to go through to do so are usually too expensive. Thus, just ignore them. They are bluffing hoping you wont call them on it.

As HHM already pointed out, they still hold the lien and a right to repossess the property. I like to just keep repeating, my new mantra, that liens survive bankruptcy (with few exceptions).

As already pointed out, a lot of what these "secured" creditors do, is all posturing. This is because the value of the furniture is surely less than what you paid for it. I would also guess that the cost of recovering the furniture approaches or exceeds the cost to write it off.

However, in the end, they do have a right to repossess the furniture. While I'm in a Chapter 13, I haven't had one of my creditors that had security interest in furniture (Rooms To Go), household goods (Lowe's, Home Depot), electronics (GE Money Bank), even file a secured claim. It's just not woth the effort unless the purchase was recent and the value is still there.

Still, you are taking a chance by calling their bluff. Be prepared to actually need to surrender the furniture should they call your bluff. :)

NFM is the only creditor that is coming after me like I owed them 20,000. I only owe them 800 but nevertheless they will probably be at my 342 meeting. If they are there will I need to surrender the property that day or will they give me a 30 day window?

They will need a court order to repossess the property so, no, you will not need to surrender it. Also, I am willing to bet they will NOT be at your 341 meeting.

Yeah, for $800, it is not even worth their pursuing it. :) A motion for relief from the automatic stay, alone, would cost them no less than $350 just to prepare. This is one case where calling their bluff, will probably work.

You need do nothing at this point, and as already posted, they probably won't even show at the 341 Meeting of Creditors. It's just not a lot of money and they'd literally burn more money than it's worth in attempting to collect it.

Strange how the smallest dog (creditor) has the loudest bark. However, they have no bite. :)

Yeah, for $800, it is not even worth their pursuing it. :) A motion for relief from the automatic stay, alone, would cost them no less than $350 just to prepare. This is one case where calling their bluff, will probably work.

You need do nothing at this point, and as already posted, they probably won't even show at the 341 Meeting of Creditors. It's just not a lot of money and they'd literally burn more money than it's worth in attempting to collect it.

Strange how the smallest dog (creditor) has the loudest bark. However, they have no bite. :)

Ok but keep in mind, the Trustee could make you pay for that secured interest in the furniture. Thats what mine has done - Dell filed something saying they had a $200 secured interest in my 4 year old computer so the Trustee said I had to send him $200 for that.

Ok but keep in mind, the Trustee could make you pay for that secured interest in the furniture. Thats what mine has done - Dell filed something saying they had a $200 secured interest in my 4 year old computer so the Trustee said I had to send him $200 for that.

What?? The trustee does not have authority to do so.

I had my 341 yesterday and Nfm didnt show up, nor did the trustee say anything about it. She just said that she was going to complete the report on my case and that I could leave. She did mention that she was a trustee but another trustee might contact me for more info, what is that about? Is that normal? That another trustee will contact me after the 341? Is it because I filed pro se is why another trustee will call. Also my creditor for my car loan, did show up which surprised me because I wasnt thinking about them and I am current on that bill.

The wanted to know if I had received reaffirmation paperwork from them and did I want to reaffirm. I told her that since my car isnt worth as much as the loan is for, that I would want to make a deal either lowering the amount I owe or something, she is going to talk to the bank about it and see what they can come up with. Right before you go on the record with the trustee there is a paper you have to read about bankruptcy, and right in that paper it states that you dont have to pay back a loan that has been discharged but you can if you want to and you dont have to sign a reaffirmation to do it, so if they dont want to make it worth my while to sign with a better deal then I will just keep paying to loan as is with no reaff paper. I think they are just counting on a pro se person to be so unknowledgable to read and understand the papers and forms. They just want you to sign the papers to keep you locked into the deal.

I have decided to surrender my house, it is about to go into foreclosure anyway. On my statement of intent, I said that I wanted to keep it but now I dont. The trustee told me that I would need to amend the state of intent form, what happens if I dont amend the form? Will that hold up getting my discharge? I am thinking that if I change my intention the trustee will see that as more income to pay the other creditors, any advice?

I have decided to surrender my house, it is about to go into foreclosure anyway. On my statement of intent, I said that I wanted to keep it but now I dont. The trustee told me that I would need to amend the state of intent form, what happens if I dont amend the form? Will that hold up getting my discharge? I am thinking that if I change my intention the trustee will see that as more income to pay the other creditors, any advice?Just amend the form. I don't think it technically matters, because you technically need to re-affirm the debt to keep it, it could cause some administrative headaches for you.

Pay the $26 and file the amended Statement of Intentions.

Ok but keep in mind, the Trustee could make you pay for that secured interest in the furniture. Thats what mine has done - Dell filed something saying they had a $200 secured interest in my 4 year old computer so the Trustee said I had to send him $200 for that.I never heard of such a thing. The Trustee may state that you owe the money, but the Trustee can't make you pay it. :) The way the creditor exercises his/her rights is to accelerate the loan terms and then to repossess the property.

Are you sure the Trustee said something similar to "you need to write a $200 check to Dell." Or, was it more like, "you owe Dell $200 and you would need to pay that in order to keep the property." Very different statements.

You could actually Redeem the Dell, and I would bet my socks that the Dell computer is worth $50.

I never heard of such a thing. The Trustee may state that you owe the money, but the Trustee can't make you pay it. :) The way the creditor exercises his/her rights is to accelerate the loan terms and then to repossess the property.

Are you sure the Trustee said something similar to "you need to write a $200 check to Dell." Or, was it more like, "you owe Dell $200 and you would need to pay that in order to keep the property." Very different statements.

You could actually Redeem the Dell, and I would bet my socks that the Dell computer is worth $50.

well... maybe I got it confused? What the Trustee sent me was a demand for $200 for 'non allowable computer and media". I wondered about that as whatever I put on my exemptions page with my attorney, should have been allowed as everything was under the exemptions amount - but when I looked on pacer I noticed Dell had made a $200 secured claim - so thought THAT is what the demanded $200 was for.

well... maybe I got it confused? What the Trustee sent me was a demand for $200 for 'non allowable computer and media". I wondered about that as whatever I put on my exemptions page with my attorney, should have been allowed as everything was under the exemptions amount - but when I looked on pacer I noticed Dell had made a $200 secured claim - so thought THAT is what the demanded $200 was for.Strange indeed. Even more strange as you now word it.

If it was secured property that you were keeping and it wasn't exempt, then I can see the Trustee asking for $200 of value. However, it is still really strange, to say the least.

Would be nice to know exactly where the Trustee thinks the $200 is coming from.

well... maybe I got it confused? What the Trustee sent me was a demand for $200 for 'non allowable computer and media". I wondered about that as whatever I put on my exemptions page with my attorney, should have been allowed as everything was under the exemptions amount - but when I looked on pacer I noticed Dell had made a $200 secured claim - so thought THAT is what the demanded $200 was for.

I concur, something is not adding up. You said you had a lawyer, what was his/her take (hopefully you didn't use some cut rate lawyer).

First, it would be odd for the trustee to even demand an amount so small $200. I don't even really have a guess as to what it might be.

I concur, something is not adding up. You said you had a lawyer, what was his/her take (hopefully you didn't use some cut rate lawyer).

First, it would be odd for the trustee to even demand an amount so small $200. I don't even really have a guess as to what it might be.

My Lawyer probably was cut rate, I dont know. He worked for a law firm, (I dont know if Im allowed to say the name on here or not) and while he filled everything out, I didnt feel he did a very good job. At the 341 meeting he showed up, but never advised me what the Trustee would ask, I didnt know I would need to account for my 2007 taxes so I was caught off guard.

Then the Trustee told me Id have to send in my stimulus package, and when I asked my lawyer about it after the meeting, he said 'dont worry he wont want any more'. Then when my case was discharged I asked him if the Trustee would want me to pay anything else or was I done, and he told me I was done and wouldnt have to pay anything else. (this was a year ago).

Its only recently I received the demand for the $200 (and my 2008 tax refund). The letter said that he (my trustee) received permission from my lawyer to write me directly. I finally found my attorney (his number had been disconnected and he no longer works for that law firm) and I asked him about that - his having told the trustee they could write me directly and his reply was 'yeah'. Then I asked him about the taxes and $200 and he said he didnt know what to suggest other than to send the $200 in and to write a letter telling the trustee that my taxes were exempt (as they were Earned Income Credit).

His demeanor was very 'Im doing you a favor, dont bother me again' kind of thing. Soooo this is why I was looking at pacer - trying to figure out whats going on, as my case should have been a no assets case (the bulk of my income is child support and even with that Im at about half the median income with no other real possessions - my car was taken back and everything else is below exempt allowances).... which is why the Dell secured interest is the only thing I can think that $200 would be.

Yes, that sounds like a cut-throat attorney. They cut your throat, then leave you there bleeding. (I don't mean to sound mean and gory, but it's the truth.)

You may want to write the bar association. :) When a lawyer takes your case, it's his case until the earlier of it closing or him being official withdrawn.

That's just my $0.02. I'm sorry to hear you going through this apparently apathetic attorney.

Yes, that sounds like a cut-throat attorney. They cut your throat, then leave you there bleeding. (I don't mean to sound mean and gory, but it's the truth.)

You may want to write the bar association. :) When a lawyer takes your case, it's his case until the earlier of it closing or him being official withdrawn.

That's just my $0.02. I'm sorry to hear you going through this apparently apathetic attorney.

Oh! I didnt realise they HAD to still be your lawyer. He never informed me that he was officially withdrawn - and my case hasnt closed yet - altho Im hoping it will soon as I sent my filed taxes into the Trustee so he will see theres no money to be had from my taxes - then I will be done with the lawyer as well. I definitely will not recommend him to anyone in future either!

Thank you for your 2¢ - the support is very appreciated :)

You may want to write the bar association. :) When a lawyer takes your case, it's his case until the earlier of it closing or him being official withdrawn.


That is "sort-of" true, but not in the sense I think most people will read it.

Your lawyer will be the "attorney of record" on your case until it is closed or the attorney withdraws. HOWEVER, that does not make your lawyer your indentured servant. The lawyer is not required to do more than what they contracted to do (the court knows this too). Most cheap attorneys, their representation effectively ends at discharge (technically, at the conclusion of the 341 meeting, any work beyond attending the 341 meeting is typically excluded from the fee agreement).

Your lawyer will be the "attorney of record" on your case until it is closed or the attorney withdraws. HOWEVER, that does not make your lawyer your indentured servant. The lawyer is not required to do more than what they contracted to do (the court knows this too). Most cheap attorneys, their representation effectively ends at discharge (technically, at the conclusion of the 341 meeting, any work beyond attending the 341 meeting is typically excluded from the fee agreement).Agreed, and well explained. I would venture to guess that the smart lawyers (the one that I considered hiring at least) provide the client with a list of things that their fee covers. A smart attorney would also inform his client what gets billed above the fee and at what rate. (I'm sure this is all in the fee agreement, but I don't think all BK attorneys explain it well.)

What I don't understand is the number of BK attorneys that take cases, and know that they don't want to litigate and especially that they don't even want additional "work". They only want to file, attend the 341 Meeting, perhaps attend a hearing or two (for a Chapter 13), and be done.

That is "sort-of" true, but not in the sense I think most people will read it.

Your lawyer will be the "attorney of record" on your case until it is closed or the attorney withdraws. HOWEVER, that does not make your lawyer your indentured servant. The lawyer is not required to do more than what they contracted to do (the court knows this too). Most cheap attorneys, their representation effectively ends at discharge (technically, at the conclusion of the 341 meeting, any work beyond attending the 341 meeting is typically excluded from the fee agreement).

Ahhh ok :)
I just re read my contract with ABC Law Firm. It says that my contract is with them, not with the attorney. It also says that ABC practices as a Group Practice so any number of different attorneys can all work on my one case. And it also says that "Client agrees that ABCs services will be considered terminated upon the following events: dismissal of the case or the closing of the case under Chapter 7". So, Im reading that to mean that they are still my attorneys until my case closes - at least the Law Firm is.

By the way, I thank both of you for your insight, as some of this is really confusing!