Question about Surrendering Vehicle

[Kam]

Well we decided to surrender our vehicle. HSBC has filed for a relief of stay and I called their attorney to tell them about our decision. The deadline for objections to Order for Relief of Stay is 10/31. The attorney's secretary said we don't have to do anything, the Trustee will enter a motion to grant the Relief of Stay and Household will contact us to pick up the vehicle. My question is: are we 100% released from any financial obligation regarding this vehicle. The secretary said HSBC would have to sell the vehicle, then file paperwork to have the unsecured part discharged with the BK. Is this correct? I just want to make sure our butts are covered because I have never surrendered anything before and since we would be giving up the vehicle after the stay was granted, it makes me think we would still be liable for any deficiency.

Cross your fingers, we applied for a 722 auto loan and hopefully will be approved and find a vehicle before we are discharged (in about 10 days or so).

Kam

[Minnymouth]

Did you sign any reaffirm papers on the vehicle with HSBC? Did you intend to keep the vehicle in the beginning of BK?

If not to the above then you are okay to go......
HSBC will pick up the vehicle, sell it and the balance will be discharged in the bankruptcy.

Minny

[Kam]

We waffled about what to do. In the petition we stated on the Intentions Sheet that we wanted to keep the car without reaffirming. I called Capital Ascension Group and told them we were attempting to get 722 redemption financing and that they would be hearing from us if this happened. I have not signed any reaffirmation agreements, and even if we did, my understanding we have 60 days to rescind the agreement from date of signing or by discharge date, whichever is later?

I just don't like being told to "do nothing" when it comes to responding to a legal document, you know?

Thanks Minny for responding

[StaciMM]

Since you haven't reaffirmed (and you're right that you could cancel even if you did) then you are clear. The debt for the vehicle is in your BK and will be discharged.

We got a replacement vehicle thru 722-and are very pleased that we did. From the time we decided to do it, the car was in our driveway a week later. It seems that their application process relies heavily on job stability.

Edited to add: FYI-the check I sent them for a downpayment hasn't cleared yet. Tomorrow will be 2 weeks from the date they received it. ARGGHHH! I hate to have checks outstanding!

[egul105]

What is a 722 auto loan?

[StaciMM]

722 Redemption is a right you have in ch. 7 (if you're upside down on a financed vehicle) to redeem the vehicle by paying the fair market value to the lender.

722redemption.com is a company that does redemption financing-since most people in ch. 7 don't have a hunk of cash sitting around. They also help ch. 7 filers w/ getting into a late model used car at wholesale price - to replace a vehicle that wouldn't be very good for redeeming. (Such as one w/ high miles, one that needs work, or perhaps you don't want to keep it because the gas use is awful or its just more car than you need.)

The downside of 722redemption.com is the APR is HIGH. Depending on the situation, though, the amount saved by paying back actual value can be enough to offset the higher APR.

[egul105]

I wish I had known about that. I got a loan for a used neon which lowered my payments by about 200 a month, and surrendered my SUV. I guess in the end it was for the best, because this has better gas mileage and is a newer vehicle, but I hated giving it up. I was about 8,000 upside down on it and the vehicle was only worth about 9000.

[Kam]

Approved for a 722 loan

We were approved for a 722 loan for a new car. Stipulations include nothing older than a 98 and less than 100,000 miles. The kicker is the closest dealer 722 has worked with is located in Helena, MT (about a 10 hr drive from us). So I am calling local dealers to see what I can find before looking at Coeur d'Alene and Spokane.

I have to admit I harbor a little twisted person who is egging me to call HSBC and tell them, "Look, you papers said our car is worth 3600 NADA, well my NADA says 2700, and with a cracked windshield and a damaged right front passenger panel, you might be lucky to get 1800 at auction. Tell ya what, let's call it good at 2000.00 and we'll pay you 200.00 a month for a year. Send me the paperwork and I'll sign." (LOL) HSBC would rather eat crow than agree to those kind of terms. I am however, going to call HSBC and question them about why there's discrepancies in the billing date and amt owed shown on our monthly statements versuses what was shown on the original contract. We are talking about several thousand dollars in "late" fees HSBC charged us over the course of 3.5 years.