Collection attempt after discharge

[discharged]

First of all, hello. As you can see, I'm new here...I've browsed around before, looks like some informative folks here.

Anywho, as the title states, I recently recieved a phone call, then a week later, a letter, from a lawfirm representing a "former" creditor. Former in quotes since the creditor was listed in my bankruptcy filing, I figured it was all over and done with.

We have been informed that your case has been discharged. Please be advised that our client is secured by a purchase money security interest in consumer goods. If you intend to voulentarilly surrender the collateral, please provide the information requested below...

It goes on asking for the name of the person returning the goods and a telephone number blah blah.

Important dates...Retained atty. Nov 2004
Filed for Chapter 7 Jan 31 05
Section 341 meeting of creditors (which 1 showed up, not this one) Mar 1 2005
Deadline to file a complaint objecting to discharge of the debtor or determine dischargeability of certain debts May 2 2005
Deadline to object to exemptions - 30 days after meeting of creditors
Discharge of debtor May 9 2005.

The credit card that this pertains to was an electronics store card issued by a major bank. Nothing was purchased on it for at least 5 months before retaining our lawyer. They didn't show up to the meeting of creditors...they didn't attempt to file an objection to the dischargeability of the debt.

They have not stated what goods they are wanting back, I'm not even sure if I have any of it as some things on the credit card were gifts, some things were sold to friends, etc., during our tough times...

Can they do anything? It's clearly stated on our discharge letter that any attempt at collecting a discharged debt is prohibited...it also says "however, a creditor may have the right to enforce a valid lien, such as a mortgage or security interest, against the debtor's property after the bankruptcy, if that lien was not voided or eliminated in the bankruptcy case". It was eliminated in my case, properly listed along with all of my other debt that was also discharged.

Sorry for the long first post, but it has me concerned...I thought our life was getting back on track, now I get threatened with this stuff...thanks for taking the time to read this...

[bezoar]

Not too uncommon. If they did not object and you received your discharge, they generally will have to file a writ of replevin to get any property back from you. This is an expensive process, and chances are the law firm hasn't a clue what the property is anyway. Bass & Associates, P.C. is well known for this behavior - they're hoping to get you to pay them something.

Follow this link for more info:
http://www.google.com/search?hl=en&l...%22Best+Buy%22

[StaciMM]

It sounds like the creditor is claiming the account was secured. If it was, then they have the right to the security interest or to payment for it. They wouldn't have to show at the meeting of creditors, file an objection, etc. (Much the same as a car loan-BK can discharge the debt and if you don't keep paying for it, the lender gets the car back.)

Of course, they would have to know what items supposedly secured the account. I don't know what would happen in the event you no longer have the items. It is convenient on their part, of course, that they're contacting you now rather than contacting your attorney 6 months ago. Had they contacted you then, you would have had the right to redeem things for fair market value. (Electronics, etc. I'm sure has a very low FMV once its used.)

[discharged]

It seems bezoar is a mind reader, because it is with Best Buy, Household Bank, and Bass and Associates.

It just caught me off guard 4 months after discharge that this could happen...The balance was around $1500. I'm sure $200-$300 of that is in late fees and whatnot. Payments were being made until about Sept of last year. Nothing was purchased on it in the months preceeding getting an atty.

Looking at some of the Google links that bezoar pointed me to, it appears I have little to worry about. I'm not sure what items I have or don't have. Worst case scenario - if they get a writ of replevin, do they just show up unannounced one day and show me a list of items requested? Or do I see a list to give me time to replace items not in my posession? Do I ignore the letter and phone call? Do I call them asking them to get a writ of replevin and see the UCC-1 filing that should be on record?

I'm still a little confused as to them not showing up at the creditors meeting...they were notified along with my other creditors...the bank obviously knows their own cardmember agreement about the security interest, etc. They were made aware that the debt was listed as unsecured...they had the chance to dispute that...is this just a loophole of sorts in the bankruptcy system?

Thanks for the replies.

[StaciMM]

My understanding is that very few creditors show at 341's, and that the only real reason to object would be cash advances, recent purchases, potential fraud. If a debt is secured by property, the creditor doesn't have to do anything during the BK process. With a car, for example, if you plan to keep it you'll keep up your payments during the BK process. If you don't they can come & get it after discharge since the stay is automatically lifted (or they can file a motion for relief from stay to try & get it sooner perhaps).

My guess is there is some fine print in the credit agreement saying the purchases create a security interest. I'm not sure that it would be enforceable...

[joefromky]

Anyone know if this is a pretty common pratice with household bank.. I have several cards listed on my chapter 7 with them. Although I havent used a credit card in several years.

[discharged]

My guess is there is some fine print in the credit agreement saying the purchases create a security interest. I'm not sure that it would be enforceable...

That's what I'm trying to find out, if anyone has been thru this type of thing...my thinking is that the lawfirm was hired by HB to retrieve the alleged property from myself...now, they obviously aren't going to take it back and sell it again at Best Buy, nor are they going to give it to their friends and family...they're going to sell it at auction and try to get some money from it, and give that to HB minus their service charge...since HB would be recieveing money, doesn't this go against the BK stating no attempts to collect a debt shall be made? Maybe I'm reading too much into this, but I'd like to know if anyone has gone thru this...I appreciate your replies StaciMM, don't take this as me being ungrateful, just wanting personal experiences I guess.

EDIT:
@ joefromky: It appears that way thru some addl. searching, at least with Best Buy/Household combo...not sure about others.

[StaciMM]

No offense taken! I think its a better outlook to question everything than to accept everything!

There is difference between trying to collect what was owed and trying to get back a secured item. A secured creditor wouldn't be able to come after you for a deficit. Say you owe $10k on a car and you didn't make payments during the automatic stay. The creditor could contact you afterwards to make arrangements to pick the vehicle up. (They probably wouldn't HAVE to contact you-that may depend on local laws.) If they get it back and they sell it at auction for $3k-that $7k difference is discharged in the BK.

I did read a post-here or on another BK board, I'm not sure-that a creditor sent someone a letter asking to let the creditor know if they were surrendering the vehicle or intended to keep it. I would think that would be the nice thing to do-and that isn't the same as sending a bill for the $10k.

If you have secured property where you maintain the payments during the BK process the creditor wouldn't contact you after BK. As long as payments are being made, they're not going to bother w/ picking up the vehicle.

[krbkrb]

I'm just hopping on this thread....

Discharged...

I am worried about the same letter, same threat. I have received two letters from them so far. I guess the phone calls might start coming now.

So, if it goes as far as this Writ of Replevin...do we get a copy mailed to the house so we know they are going to be coming over with the sheriff?

What if you just say you sold the stuff? Do you have to let the sheriff in the house?

[discharged]

Wish I could help, I know as much as you do about this...I just got a hold of my lawyer finally, they said to fax them a copy and they will advise Bass & Assoc. to stop contacting me...I guess if anything comes out of this, my lawyer should (hopefully, as my BK is over) let me know if any legal actions will be taken...I've stopped worrying about this...if they want it, come get it 'cause I probably don't have it!

I'll of course update this if anything happens. If my pc wasn't bought on the card.

[Minnymouth]

If you purchased a computer on a cc and the company says they have a secured interest in the merchandise until it is paid in full, then they have the right to request the merchandise be returned. This could be for a computer or furniture, etc.
Most companies do not go to the length of picking up used merchandise to resell.
If they do, let them have it....best clean up all the loose ends....
But let your lawyer know they are requesting it....


Minny