car loan with no lien on title?

[Chowder]

....it sounds like I may not have to pay much to keep the car?

It sounds like you don't have to pay anything to keep the car.

Now, the unfortunate part is that you may have a $14K asset for which you have no exemptions to cover. .

I'll go out on a limb a say the trustee would shy away from battling the creditor over this one.

[Chowder]

Ford had an attorney file an appearance and request for service at our 341, and in speaking with him, he thinks they still have rights to the car.

Well of course he does!

Sounds like they have a copy of the title, it's just in your name. Not sure what would prevent them from correcting that.

Still if you had a clear title, they would be taking a serious risk repo-ing that car.

[freedom7]

the copy of the title they have is issued in PA, I had that title clear and then moved to NJ where I got a new clear title there.

Can they now correct it in NJ?

[Chowder]

I'm guessing they'd meet little resistance if they wanted to.

Question is how ready are you to dance with them. If you have a clean title in hand and they know it. And if you can keep the car out of reach for a while, you might be able to at best make them give up, or at worst settle for a few thousand.

But like justbroke points out. If you push this too hard before discharge, you may end up giving up the car. IIRC there is a similar thread here. The creditor ended up converting to unsecured, and the debtor lost the collateral.

[justbroke]

I'll go out on a limb a say the trustee would shy away from battling the creditor over this one.

Absolutely not. The Trustee's love battling creditors. They are the prime source for avoiding preferential payments and other transfers.

[Chowder]

So, you're of the opinion that the creditor is just plain out of luck?

[justbroke]

So, you're of the opinion that the creditor is just plain out of luck?

Trustee's specifically and most certainly look for real and personal property that has been improperly recorded. This is a prime place where they can get lots of money!

What do you all think? pro se debtor, so no attorney to check with... next step may be motion to determine secured interest in property

It would be a Motion to Determine Secured Status. You need to find out whether your District does this as a contest matter (by motion) or by complaint (adversary proceeding/AP). The latter form can be difficult as it's a little more involved. Please make sure you use the correct method.

Also, you need to make sure that you exempted that property in full. I would make sure your Schedule C is updated to reflect this.

If not, the Trustee will be all over it! This is real money for the Trustee. The Trustee makes about $2,250 on the first $10K and that's after their attorney fees. I don't see any panel trustee giving up that money.

[Chowder]

Trustee's specifically and most certainly look for real and personal property that has been improperly recorded. This is a prime place where they can get lots of money!

I had no idea they had the time to research every title.

[justbroke]

I had no idea they had the time to research every title.

Well, I'm not going to sit here and say they do in every case, but here's the verbatim text from a Report of No Distribution on the subject...

I, XXXXX, having been appointed trustee of the estate of the above-named debtor(s), report... that I have made a diligent inquiry into the financial affairs of the debtor(s) and the location of the property belonging to the estate; and that there is no property available for distribution from the estate over and above that exempted by law...

So, yes, they look.

[LimpDisc]

My lawyer came accross one of these exact situations. The trustee took the car to sell it to pay creditors. The debtor & creditor both ended up with nothing. He said the creditor screwed up by not perfecting the lien and the cars value was to high for the debtor to exempt. Can you exempt the value of the car? If not, the trustee will take the asset.

[freedom7]

The trustee didn't even seem to care that the lien was recorded in PA, he said his look back on this would only be 90 days and the lien was recorded over a year ago, even though it was two years past perfection.

So, Ford's stance is that I must reaffirm or redeem by discharge, roughly by 11/10, or they will repo upon discharge, no ride thru, no nothing.

I will not reaffirm a loan that is 6000 upside down retail value and lose all leverage if I wish to return at a later date. so do I redeem or hold out and see what happens?

[freedom7]

the car is totally exempted using the federal wildcard since I have no equity in a home to exempt plus doubling with my spouse.

[LimpDisc]

Keep us informed about how this turns out. We just purchased a car 3 weeks ago. We had the "perfecting the lien" conversation because of this exact situation. We need to make sure there are no screw ups in our situation because we lose the car. From everything he explained to me, I don't know how Ford can repo. Ford screwed up big time!!!

[Chowder]

the car is totally exempted using the federal wildcard since i have no equity in a home to exempt plus doubling with my spouse.

merry christmas!

[justbroke]

The trustee didn't even seem to care that the lien was recorded in PA, he said his look back on this would only be 90 days and the lien was recorded over a year ago, even though it was two years past perfection.

Strange, your Trustee seems to be looking at 11 USC 547(b) which is about preferences. The Trustee gets his lien avoidance powers from 11 USC 544. It gives the Trustee avoidance powers for things un-perfected at the commencement of the case (See Rouse v. Chase Manhattan Bank, U.S.A., N.A. (In re Brown), 226 B.R. 39, 45 (W.D. Mo. 1998))

Perfection of liens is based on underlying State non-bankruptcy law. Most States have a 20-day perfection requirement. If it's not perfected in that period, it's an imperfect lien and subject to litigation as to validity and enforceability.

Strange that the Trustee messed up with preferences over liens. Anyhow, hopefully you have that vehicle fully exempt and your Schedule C indicates as much.

If the Trustee is not interested, they are just not interested. However, take all precautions.

So, Ford's stance is that I must reaffirm or redeem by discharge, roughly by 11/10, or they will repo upon discharge, no ride thru, no nothing.

That's why you need to file a Motion to Determine Secured Status and Avoid Lien (whether that's through a contest matter or complaint).

I will not reaffirm a loan that is 6000 upside down retail value and lose all leverage if I wish to return at a later date. so do I redeem or hold out and see what happens?

You need to actually take action. You and your lawyer need to avoid that lien by asking the Court to determine the secured status. You get to step into the shoes of the Trustee and avoid the lien under 11 USC 544 yourself.