Can a creditor SELL an account AFTER filing date?

[lookitsphillie]

I had a Citi issued Sears account.

They sold it to LVNV funding AFTER my filing date.

LVNV filed proof of claim.


Is this allowed? Selling after file date?

Can I force Citi to reacquire the account?

[aa06a47]

They can and often do sell the accounts. Time value of money for the credit card company, they don't have to wait 5 years to collect. The people who purchase it pay pennies on the dollar.

I have actaully read a few cases where debtors challenged the proof of claim and always lost. What you have to watch out for is someone filing a claim that doesn't have a legal claim.

If you saw a claim from just LVNV Funding without the words...for Citi..or whatever nomenclature they chose to use, then you can challenge the claim.

American Express, MBNA, GE Money Bank have all sold my accounts. So far, nothing from Citi or Chase.

[lookitsphillie]

I want to reaffirm with Citi. I want Citi to collect 100%.


How can I trigger them to get the account back in their hands.

I know they have the ability to get it back.

[FilingOnMyOwn]

I want to reaffirm with Citi. I want Citi to collect 100%.


How can I trigger them to get the account back in their hands.

I know they have the ability to get it back.

I would not try at this point. They've already sold it, and although they would readily accept money from you, the new 2nd creditor will also be pursueing you for the full balance.

[aa06a47]

I know it is hard to do, but try and think of bk as a business decision. You have taken the steps to get a fresh start, by filing BK. Don't come out of a chapter 7 bk with any debt other than secured debt. Your attachment with Citi may be emotional...just accept the debt is gone and be thankful.

Trust me, we are all just numbers to sears and citi. Don't feel like you owe them any special treatment. Citi was one of the first to invoke the universal default rate on all my accounts with them because I was one or two days late on one payment. They even went as far as sending me a letter telling me my previous payment was being adjusted up because they had missed that the universal default rate should have been used on my card.

[SinkingFast]

While you may want one unsecured Creditor to be paid in full, the minute you filed BK, that decision no longer became yours. Unless you're in a 100% payback plan, the Trustee is gonna decide who gets how much.

Secureds and Priority Creditors are paid first. Any piece of your Ch 13 plan payment pie that's left over, the Trustee will distribute according to who's applied. Since Citi has already sold the debt, Citi may not even apply for repayment.

Even tho Citi may have the ability to get the acct back, chances are they won't want to. Citi would rather sell the debt for pennies on the dollar and write you off their balance sheet than mess with accounting for small amounts that will dribble in from your Ch 13 plan over the next 3-5 years.

[lookitsphillie]

I work for Citi and my plan will be dismissed relatively soon anyways.

I now make too much money to stay in a 0% plan and I'm not about to have a trustee suck the life blood out of me funding a 100% plan to pay collection agencies that bought debts from original creditors.



My mom will BT the amounts for me. The total amount of all my BK claims can be paid in ONE $300 a month payment to her credit card.


By using balance transfer on her cards, the money will in a sense be shoved down Citi's throat. Citi's systems do not reject electronic payments.


Once they receive the payment in full, will they automatically "rebuy" the account?

[SinkingFast]

If your plan is dismissed you'll loose the protection of the Automatic Stay. ALL of your Creditors will come at you at once WITH all the lates and penalties, and interest that would have normally accumulated during the time you've been in Ch 13.

Have you taken into consideration the increased debt level and the loss of the protection of the automatic stay??

You can have your plan ammended to account for your increase in income. You'd just pay bigger payments into your Ch 13 plan.

You really need to think about this before you work to get your plan dismissed.

A CC with a $10K balance before you started in Ch 13 could easily have ballooned to $13K in a very short period of time.

That's just one line of Credit. If you have several, you could be looking at some seriously inflated levels of debt. And the Creditors are not gonna be Mr. Nice Guy. They will come at you fast and furious.

Ultimately it's your call, but I do hope you take some time to think about what you're planning to do and discuss it with your attny.

[lookitsphillie]

If your plan is dismissed you'll loose the protection of the Automatic Stay. ALL of your Creditors will come at you at once WITH all the lates and penalties, and interest that would have normally accumulated during the time you've been in Ch 13.

Have you taken into consideration the increased debt level and the loss of the protection of the automatic stay??

You can have your plan ammended to account for your increase in income. You'd just pay bigger payments into your Ch 13 plan.

You really need to think about this before you work to get your plan dismissed.

A CC with a $10K balance before you started in Ch 13 could easily have ballooned to $13K in a very short period of time.

That's just one line of Credit. If you have several, you could be looking at some seriously inflated levels of debt. And the Creditors are not gonna be Mr. Nice Guy. They will come at you fast and furious.

Ultimately it's your call, but I do hope you take some time to think about what you're planning to do and discuss it with your attny.

I am aware the stay will drop immediately.

I was NOT aware that they would be able to add interest that would have accrued during the plan.

At the 30% default rates, I certainly cannot afford to let the stay drop if I will be charged back interest.

Damn......

If I advise the trustee now of increased income, but my current plan and payments are ok, will he 100% guaranteed demand the payments be increased?

[aa06a47]

Sinkingfast is 100% correct in her post.

You should make every effort possible to not let your bk case get dismissed for the reasons stated..."I'm not about to have a trustee suck the life blood out of me funding a 100% plan to pay collection agencies that bought debts from original creditors."

Now, if your income changed enough that you feel you will go from a 0% plan to a 100% plan, you must have gotten a big fat raise. Be aware that your plan will only go for a max of 60 months. How long have you already been in the chapter 13 plan? Yes, if you got a big enough raise that you cannot cover it with increases in gas cost, utility bills, taxes, medical expenses,., ect., the trustee will want more. You might talk with your attorney, you might be surprised that the payment might not go up as much as you think.

Don't worry yourself with who gets the money. When your creditors sold your account, they did so with the knowledge that they get paid up front by the person who bought the debt. It is time value of money to the credit card company. Those CC companies are using the money they got from the debt purchasers to loan to someone else so they can charge 30% interest to.

[lookitsphillie]

My "paper" salary is only 24K.

That 2000 a month gross was increased from a pre petition 500 a month gross.

However, when I file taxes, the commissions from my position and such will have me filing almost 40K on taxes. I live with parents.


I guess I'll have to get really creative with expenses and hope they don't notice. I guess I can try to spend more money on clothes, gas, etc


My attorney has said they wouldn't particularly care if I had savings being accumulated. Is this true? How much could I save up? 5K? 10?

[SinkingFast]

You're not supposed to save during a Ch 13 plan. A Ch 13 plan is supposed to take all disposable income. With this kind of change in income, you'd probably see a significant increase in your payments if your expenses do not change.

If you don't report your change soon, and the Trustee wants to see your Income Taxes next spring, you could be in some serious trouble. Ch 13 plan participants are supposed to report changes in income ASAP when they occur.

Of course you've probably had to buy clothes and such that you didn't have for the job. And now you have travel and lunch expenses. But that alone won't offset the increase in income.

How about an apartment of your own?? Now there's rent, and utilities, and phone, and food that you did not pay before. Plus you'll need some furniture.

If you've been in your plan for a year, maybe petition the Court to see about buying a car. You've got to get to work don't you?

Some Trustees allow a modest amount to be put away for retirement. Up to 3% or so. Maybe start putting a small amount into your company's 401K savings plan.

[anonymuse]

Here's some articles on this:

'Zombie debt' comes back to haunt consumers

http://www.bkblog.net/blog/_archives/2006/6/27/2060869.html

Zombie Debt Collectors dig up your old mistakes

http://moneycentral.msn.com/content/Savinganddebt/Managedebt/P74812.asp

Sleazy New Debt-collector Tactics

http://moneycentral.msn.com/content/Savinganddebt/Managedebt/P95315.asp

It's a big business, but also often violates the FCRA.

[aa06a47]

I am not sure why you are in a chapter 13 to begin with if your income was $24K when you started. Should have been a slam dunk chapter 7 for you. Living at home making 40K plus...yeah, your payments will go up quite a bit. You might want to get your own place. I would talk to your attorney.