Auto Title/Equity Loan?

[HorseyMom]

Hello, new here. DH and I are going to file bankruptcy, but haven't decided on Chapter 7or 13 yet. We have a second mortgage (2 yrs delinquent on payments) that we'd either like to strip with Chapter 13, or settle with them if we go with Chapter 7.

We have a truck that we own (have the title) and want to keep. We've already had our free consultation and the attorney recommended that we get an auto title loan if we go with Ch. 7, in order to keep the truck. A week ago we applied for one at our local bank, which we've had an account at for 12+ years, but haven't heard back from them. We asked for $7k, truck is worth $13k ($6k is exempt).

If the bank denies our loan, is there anywhere else we might have luck trying for one at? I've searched, but don't know if any of them are legit. Does anyone know about helpingloans.com (from roadloans)?

[justbroke]

That's a good strategy (bankruptcy pre-planning) that your lawyer suggested. I don't know of any other companies that will take a vehicle that is not currently encumbered and issue a title loan. The best place is probably through the local CUs. Maybe apply at a couple of other CUs. (If you are rate shopping, do all the apps within the SAME WEEK as it will not affect your score for that week.)

[keepmine]

Also, do you have a plan for the money you receive?
Do you have enough exemptions to cover the $6K or a plan to spend it down?

[Freddy03]

We had to get a title loan to qualify for Ch. 7. We only borrowed $1000 b/c of FL low exemptions. It was never questioned by the trustee.

[HorseyMom]

Are you CU's normally easier to get a loan through than a bank? I'm afraid that any of them will look at that delinquent 2nd mortgage and it will be a no go.

IF we get the auto equity loan, we are using the money to settle on the 2nd mortgage and filing Chapter 7. That is the plan. If we do not get the loan, it
looks like we will be stuck filing Chapter 13 (which we don't want to do).

We've just stopped paying our cc's, some are about a week late. I'm afraid the further out we get, the less of a chance we have of getting a loan.

I was just wondering if there was anywhere else to try for a loan if the bank turns us down? Is helpingloans.com no good?

[SMinGA2]

I think CUs are more customer friendly. You would deal with a person who would have some control to consider your circumstances, rather than a big-bank using a system where its all automatically decided based on credit score alone.

[HorseyMom]

Thank you so much for the help. I am applying online at a CU right now.

Just talked to the bank and we were turned down and I know part of is was the delinquent 2nd.

Even the guy at the bank said to try the local CU's.

[keepmine]

IF we get the auto equity loan, we are using the money to settle on the 2nd mortgage and filing Chapter 7.

Nothing wrong with using part of the loan for bk legal fees. Any left over, needs to be properly exempted or it could become property of the bk estate.

[AngelinaCat]

We had gotten a title loan through our CU several years before we filed for BK. That was an attempt (futile--one of many) to stave off filing for BK. So we didn't do it as part of 'bankruptcy planning', but it came in handy when we did. At the time that we filed, we still had about 10-13 months of payments to make. This led the trustee to formally 'Abandon Interest' in the vehicle as being 'fully encumbered'. We were an Asset 7 case.

[HorseyMom]

Yes, the attorney said they will leave the truck alone if we get a loan for the amount leftover after our exemption. And, we will just reaffirm the loan. All of the money will be gone before filing.