Repossession

[jenbes27]

We are in the middle of a chapter 7 and stuck in limbo b/c we are waiting for judges decision on conversion to 13.
Question, we have to surrender a boat. The bank told us we are welcome to sell the boat (its work 2 - 3 k more than we owe). I would like to sell the boat to avoid a repossession on my credit report. I don't know if it is okay to sell the boat, my lawyer didn't have a real answer. Does a repossession affect your credit report any more than a bankruptcy? Would it make any difference?

[FreshLikeADaisy]

As far as I know, Jen, you are IN bankruptcy right now, so all of your accts should be IIB as far as your credit reports are concerned. IIB = Included In Bankruptcy. When you surrender secured property in bk, it's not like a regular repo on your credit report, it's part of the bankruptcy and should not be reported as a repossession. Again, the ONLY thing that trade line should say is IIB, now and forever after. If they report something other than that you can dispute it with the credit bureau and not have a problem getting it corrected.

As far as selling it, I have no idea: the bank told you to sell it, but unless you could exempt the proceeds (above and beyond the amt of the loan) you might as well just hand it over to the bank and be done with it. I'm sure they'd love for you to do their work for them, but in bk you have the right to surrender the property and walk away. If you can't realize that $2-3k equity in a sale, or can't exempt it if you do, walk away: you've lost nothing by doing so.

Does that make sense? Good luck!!!

[poorme]

FLAD is right - you sell the boat for the bank so they don't have to do the work, and then you turn your 'surplus' over to the BK estate via the trustee. I'm sure you have better things to do with your time.

[tay666]

I would not sell it.
IF you have filed for BK, regarless of which chapter it ends up being, your trustee controls the estate.
Do not do anything with assets without the trustees consent.