Lein on vehicle after discharge?

[smokedurhonda]

hello i had used my car title to get a loan, filed for chp 13 and converted it to a chp 7, discharged in october of 08. im in the process of trying to get my vehicle title but they say i have to pay them $800 shouldnt this have been included in the bankruptcy? the car has 176k on it its a 98 ford taurus, but without the title i cant even get it towed to the junkyard. is there anyway of getting around a lein release?

[StartingOver08]

Call your BK attorney and find out how to get the car title. It may be just a simple letter from the attorney. Or, he may have to go through a process to avoid the lien. Check with him first.

[HHM]

Liens survive BK, sorry.

At this point, given the amount invovled, paying them the $800 is probably your most cost effective option. The lender will get paid something regardless.

The other option is for your attorney to reopen your BK, file a Motion to Value the Lien (i.e. how much was the car worth when you filed the BK), and then you will need to pay the lender that amount. That process will probably cost more than paying the lender the $800.

[justbroke]

[floridian]

now im confused... i thought thats one of the reason to file bk, was to eliminate any and all leins..

[HHM]

now im confused... i thought thats one of the reason to file bk, was to eliminate any and all leins..

Really, and how long have been around this forum...

Here is the 411 on liens.

ALL liens survive BK UNLESS...

1. 2nd mortgage in chapter 13. You can strip this lien if the home is worth less than what is owed. Otherwise, the lien stays.
2. PMSI (Purchase Money Security Interest) on Cars. In chapter 13, you have the 910 day rule, the lien STAYS, unless the loan is older than 910 day, in which case you can cram down to current value of asset. In chapter 7, you have cram down + redemption; in chapter 7 you pay the value of the lien. If you do nothing in a 7, the lien survives.
3. Judgment Liens. In chapter 7, can be removed if the underlying debt is dischargeable.
4. Non-PMSI - In chapter 7 and 13, can be crammed down to current value of the asset.
5. Tax liens - can be crammed down.

Note, only options 1 and 3 allow actual removal of the lien.

[floridian]

HHM, please excuse my ignorance and im going to try to do better in the future...

how about calling my lawyer and enlighten him too, hes the one that told me the bogus information.. maybe he will give me a refund..

[Brighterdays]

you can charge the neighborhood kids $5 a wack with a baseball bat. When you get to $800 you can turn the car over to the creditors. Maybe claim hail damage or something. This is the rainy season you know?

[justbroke]

4. Non-PMSI - In chapter 7 and 13, can be crammed down to current value of the asset.

Non-PMSI liens can also be stripped if they impair an exemption, and the non-PMSI is on "household" goods. (Yes, I've done this!)

I was also going to add that all liens survive bankruptcy, with limited exceptions. In those exception cases, you still need to file a complaint (adversary proceeding) or a contested matter (by motion) with the court.

Liens don't automatically disappear unless the underlying debt is paid, the collateral surrendered or repossessed, or there is some time bar (limitation) associated with such lien.

At least, that's my read.

[HHM]

Non-PMSI liens can also be stripped if they impair an exemption, and the non-PMSI is on "household" goods. (Yes, I've done this!)

I was also going to add that all liens survive bankruptcy, with limited exceptions. In those exception cases, you still need to file a complaint (adversary proceeding) or a contested matter (by motion) with the court.

Liens don't automatically disappear unless the underlying debt is paid, the collateral surrendered or repossessed, or there is some time bar (limitation) associated with such lien.

At least, that's my read.

True enough. I was trying to avoid getting too technical (a lien strip is essnetially a cram down to zero value )

[smokedurhonda]

deja vue it is, thanks for the advice to all who replied.