vehicles and chapter 7

[craymon]

Hello,

I'm in the process of filing 7... Outside of the 80,000 in credit cards and medical bills, I have 2 vehicles financed at a Credit Union along with 2 unsecured loans... Since looking into filing bk, I have found out that my unsecured loans have been cross collaterized with my vehicles... I owe approx 5,000 on the vehicles and approx 11,000 on the loans...

Questions:

1. If repoed, the vehicles won't bring enough to cover paying them off much less covering any on the loans... What are the chances that they will negotiate with me on paying off the vehicles and releasing the titles without paying off the loans??? Any ideas on how to approach this??? I've received a letter from the credit union saying that we have until the 10th to catch up on the payments or they will pursue repossession and lawsuits for the non-payment on the loans... Any ideas on how to proceed would be appreciated...

thanks,

craymon

[rrockinggramma]

with a credit union, your chances are slim and none. They can be vicious and the cross collateralization will get you every time. If you are not using the credit union accounts and do not wish to continue to bank there (they will shut you down unless you reaffirm all loans and vehicles) then I would suggest checking out 722 Redemption as an option. They might be able to refinance your vehicles for you at FMV (although higher interest) but then you could walk away from the credit union loans entirely. To use 722 you must go through your lawyer as it is approved by the BK court and must be completed prior to discharge. Good luck.