Assets turned over in bankruptcy

[robinsj]

First time poster here. We have a yamaha piano that we have/had a loan on through GE Money Bank/Yamaha retail finance. We filed for bankruptcy on Oct 20th, had our 341 meeting on Dec 5th, and the discharge is on Feb 3rd. We did not reaffirm with GE for the piano, and stated we would voluntarily give it up. We have not been contacted by GE at all about the piano being turned over, either through our attorney or through the 341 meeting.

My question is, when will they take it? I am actually really good friends with the guy that owns the piano store that I bought it from, and he tells me they won't come and get it, and that he has never picked up a piano from a bankruptcy. Do they have some kind of time frame themselves to come and get it in? Is it actually a secured debt? Or is it unsecured?

Anyway, Thanks for any help!! Have really enjoyed reading the forums hear, and learning from others experiences..

[justbroke]

It's a secured debt. GE Money Bank (GEMB) probably has what's called a "purchase money security interest" in the piano.

Your friend's store was already compensated through GEMB and you owe GEMB, not the piano dealer.

Whether GEMB comes and gets the piano, is now unknown. You will just have to wait and see. Generally, they won't come for the property until after you have been discharged and closed.

[robinsj]

What is a "purchase money security interest"?

Also, I understand that my friends has already been paid for the piano by GEMB. That wasn't really the point. I think he is trying to say, he is the only Yamaha dealer within several hunderd miles, and he would assume that he would be contacted to pick up a piano, since he could resell it for the most... at least that is what I would assume too.... But we all know what happens when you assume !!!

Interestingly enough, our attorney told us they would pick it up before our discharge date.... But we will just play the waiting game, and see what happens. Thought I would post on here and see if anyone had any similar experiences with GEMB....

[justbroke]

What is a "purchase money security interest"?

It's the small print that many borrowers don't read. It basically means that everything you buy on the credit card, automatically has a lien placed on it. The items you buy become secured the instant they are purchased on the card.

Also, I understand that my friends has already been paid for the piano by GEMB. That wasn't really the point. I think he is trying to say, he is the only Yamaha dealer within several hunderd miles, and he would assume that he would be contacted to pick up a piano, since he could resell it for the most...

GEMB has to arrange for someone to come and get it. They may or may not actually use a Yamaha dealer. They may even donate it to a charity, who would come and pick it up.

Technically, GEMB would need to get a relief from stay if they wanted to touch that property before discharge and close. The reason is, because it is secured. Unless the Trustee has actually abandoned it by motion, it's property of the estate. This is regardless of what you wrote on your Statement of Intentions until the earlier of an abandonment by the Trustee and/or you, a granted motion for relief from the automatic stay, a dismissal, or a discharge and close, whichever comes first.

This is why real estate lenders are real particular about obtaining a relief from stay prior to foreclosing on a surrendered home.

I have secured debt with GEMB, but they filed as unsecured. They apparently don't want anything I purchased. As a matter of fact... all of my department store cards and one of two installment loan companies, filed as unsecured. That was a shocker to me.

Please come back and let us know when they come and get it, if they ever do.

[BnkrptcyLwyr]

What is a "purchase money security interest"?

Basically, a lien.

SOME credit cards are actually secured credit cards - which basically means that what you buy with that particularly credit card is collateral for the money loaned on the credit card.

The only secured credit cards are for places where you purchase the bigger ticket items and for which the collateral is actually worth something (furniture stores are a great example - Art Van, Gardner White).

Your generic credit card is not secured. Why you ask, since it would be smart to have a lien on purchased items? Think what you purchase with those credit cards sometimes - food, gas, clothes. No credit card company wants that stuff back (especially the food - yuck!) Furniture and electronics stores - a different story.

[deadbroke99]

It's the small print that many borrowers don't read. It basically means that everything you buy on the credit card, automatically has a lien placed on it. The items you buy become secured the instant they are purchased on the card.

GEMB has to arrange for someone to come and get it. They may or may not actually use a Yamaha dealer. They may even donate it to a charity, who would come and pick it up.

Technically, GEMB would need to get a relief from stay if they wanted to touch that property before discharge and close. The reason is, because it is secured. Unless the Trustee has actually abandoned it by motion, it's property of the estate. This is regardless of what you wrote on your Statement of Intentions until the earlier of an abandonment by the Trustee and/or you, a granted motion for relief from the automatic stay, a dismissal, or a discharge and close, whichever comes first.

This is why real estate lenders are real particular about obtaining a relief from stay prior to foreclosing on a surrendered home.

I have secured debt with GEMB, but they filed as unsecured. They apparently don't want anything I purchased. As a matter of fact... all of my department store cards and one of two installment loan companies, filed as unsecured. That was a shocker to me.

Please come back and let us know when they come and get it, if they ever do.

My furniture from Rooms to Go is financed thru GEMB. I am really hoping they don't want it. I love my couch and dining room table!

[robinsj]

I have secured debt with GEMB, but they filed as unsecured. They apparently don't want anything I purchased. As a matter of fact... all of my department store cards and one of two installment loan companies, filed as unsecured. That was a shocker to me.

How did you know that they filed it as unsecured? I really don't think they would give the piano to charity, its a $40k dollar piano....

[justbroke]

How did you know that they filed it as unsecured? I really don't think they would give the piano to charity, its a $40k dollar piano....

My computer ate my initial response.

First, I'm in a Chapter 13, so any creditor who wants to be paid, needs to file a claim (including secured creditors).

As to the $40K piano, GEMB can write if off and claim it as a loss against their taxes. GEMB could give it to a charity and write it off as a charitable contribution, again being a loss against their income and taxes.

GEMB could also hire a auctioneer / estate sales company to come get it and to sell it. The Auctioneer would then return the proceeds, less commission to GEMB and then GEMB would come to your for the difference (known as a deficiency). However, in a Chapter 7, that deficiency claim would be moot.

In the long run, no one knows what GEMB will do. However, they will continue to have a valid and enforceable lien on that property until the debt is paid off.

[robinsj]

Just thought I would ask for an opinion with an update... Our bankruptcy discharged and i pulled our credit to see what it looked like and it shows the piano as being discharged. Is this normal?

[justbroke]

Just thought I would ask for an opinion with an update... Our bankruptcy discharged and i pulled our credit to see what it looked like and it shows the piano as being discharged. Is this normal?

Absolutely normal. The debt, as to the amount you owe GEMB/Yamaha, is discharged.

However, they still enjoy holding a lien against the property.

[OhioFiler]

Absolutely normal. The debt, as to the amount you owe GEMB/Yamaha, is discharged.

However, they still enjoy holding a lien against the property.

How long do they hold the lien? I'm sure at some point it expires.

What if the piano simply disappeared? Could GEMB sue him?

I'm confused. I imagined that a "fresh start" Chapter 7 became a fresh start. Isn't there a reasonable timeframe post discharge for GEMB to repossess the piano?

[justbroke]

How long do they hold the lien? I'm sure at some point it expires.

Liens are forever.

What if the piano simply disappeared? Could GEMB sue him?

Not really. The money owed on it, is no longer collectable. It has been discharged. However, the lien makes the piano the property of GEMB.

I'm confused. I imagined that a "fresh start" Chapter 7 became a fresh start. Isn't there a reasonable timeframe post discharge for GEMB to repossess the piano?

No. However, generally, as time goes on, they forget about it. They probably already sold the account to a JDB. The Junk Debt Buyer (JDB) probably hasn't look into it yet.

I'm willing to bet that they may have wrote it off as "unsecured" debt, and may not attempt to get the piano.

[albacore44]

Basically, a lien.

SOME credit cards are actually secured credit cards - which basically means that what you buy with that particularly credit card is collateral for the money loaned on the credit card.

The only secured credit cards are for places where you purchase the bigger ticket items and for which the collateral is actually worth something (furniture stores are a great example - Art Van, Gardner White).

Your generic credit card is not secured. Why you ask, since it would be smart to have a lien on purchased items? Think what you purchase with those credit cards sometimes - food, gas, clothes. No credit card company wants that stuff back (especially the food - yuck!) Furniture and electronics stores - a different story.

What about a $2000 matttress. you suppose Citi retail would come to the door looking for it ?? Guess i could just say we no longer have it.

[OhioFiler]

What about a $2000 matttress. you suppose Citi retail would come to the door looking for it ?? Guess i could just say we no longer have it.

I can't imagine ANYONE wanting a used mattress back!

[justbroke]

What about a $2000 matttress. you suppose Citi retail would come to the door looking for it ?? Guess i could just say we no longer have it.

Not likely that they will come for a mattress or even for furniture purchased more than 2 years ago. They filed as unsecured in my Chapter 13. They have no intent of coming for mattresses and bedroom sets.

The cost of getting back these items is what weighs on these creditors. Now a $40,000 piano -- which will keep much of its value -- is a lot different.