Regional Acceptance Corp--Pay and Drive?

[rjmwx81]

Does anyone here have their auto loan through Regional Acceptance? I'm planning on filing and intend to reaffirm, but am worried about a repo if the judge doesn't allow it. Anyone had any experience with them? Will they allow a back-door ride-through if I try to reaffirm but fail?

[ccsjoe]

I believe that if you reaffirm the fact that the judge does not approve it is not causal for repo. You have reaffirmed, although effectively you are paying and riding only.

tcreegan (Tom in Colo) had a really good answer recently about this, maybe you can search.

[rjmwx81]

Yeah several people have told me that; I guess I'm just being a little paranoid and would rest easier if I knew that this particular lender didn't hassle people.

[wnguyen]

is this post you're talking about, ccsjoe?

Hi wnguyen,

In the pre-2005 BK law there was a 'retain and pay' option available in the BK code. The post-2005 BK code got rid of that option, leaving only surrender, redeem, or reaffirmation. Hence the wording in the letter from Toyota. But the BK code has two somewhat conflicting sections, and you are caught between them.

11 U.S.C. §541(c)
Contracts (and usually in auto loan contracts) can have what is called an "ipso facto" clause stating that declaring BK is a breach of the contract.
But 11 U.S.C. §541(c) of the BK code gets rid of the BK clause in consumer debt contracts (such as an auto loan):

...that is conditioned on the insolvency or financial condition of the debtor, on the commencement of a case under this title, or on the appointment of or taking possession by a trustee in a case under this title or a custodian before such commencement, and that effects or gives an option to effect a forfeiture, modification, or termination of the debtor’s interest in property. 11 U.S.C. §365(e)(1) also backs this up. So Toyota cannot say you are in a breach of contract, and thus cannot repossess, because you declared BK

11 U.S.C. §521(a)(6)
Toyota is also right because the BK code section does require a debtor under 11 U.S.C. §521(a)(6) to "not retain possession" (surrender), or "sign an agreement" (reaffirm), or "redeem such property (redeem) within 45 days of the 341 meeting.

So what is the bottom line? Caselaw is building up saying that marking "reaffirm" on the statement of intentions but having your attorney or the court not approve it is enough to satisfy 11 U.S.C. §521(a)(6) and that the lender cannot repossess due to 11 U.S.C. §541(c)

Clear as mud?

Tom in Colo

[ccsjoe]

Thanks wnguyen. I couldn't find it although I knew it was very recent.

[rjmwx81]

Like I said, I read that particular post from Tom just this morning. I realize that the case law is in my favor, but since I'm filing pro se, if I'm going to get a fight from the lender I'd rather know now than later. That's why I didn't just post in one of the 10 other threads about reaffirmation...just looking to see if anyone has experience with this particular company. But, as always, I'm grateful for the advice.

[ccsjoe]

I hope everyone gets a good laugh out of this, but I actually sent the "guts" of that post to my attorney pointing out the legal vacuum it seems to create and whether we should look into it in order to determine a ride & pay possibility. I also mentioned no need to spend time until after the 341. He agrees there's something there, we'll look into into post 341. I'll of course post any conclusions.

[telco95]

I have a vehicle financed through Regional Acceptance also. We chose to retain and pay. We filed on 7/10, had our 341 in Aug. I was also curious if they allowed this, kind of hesitant to call and ask because I don't want to stir anything up. We asked our lawyer to contact RA after our 341 to reaffirm, but have not gotten anything. I really hope they don't repo because I don't have a large downpayment and don't want to go through the process of financing right now. We'll see!

[rjmwx81]

Wow. Sounds like we're in the same boat. Keep me posted on what happens with yours, that should give me a good idea of what to expect. Let's hope, for both our sakes, that they allow a ride and pay!!