Vehicle question

[rt31]

My background is...my husband and I filed chapter 7 in June of 2012. We were discharged in September, 2012, but the case has not yet closed. As part of it we had a car loan that was not reaffirmed but we have continued to make and are current on payments. We have 12 months left and would like to trade it in on a different vehicle since we have issues with winter roads and we live in Wisconsin.

Would we be able to trade it in or would there be an issue since we didn't reaffirm? We are assuming the trade in value would exceed what we owe and that the bank balane would be paid off.

Does anyone have experience or info on this process?

Thanks in advance.

[LadyInTheRed]

The fact that your husband didn't reaffirm shouldn't make any difference. The loan just needs to be paid off. But, you need to make sure the car is not still part of the bankruptcy estate. Ask your lawyer.

[rt31]

Thanks for the response. Sorry to sound ignorant, but what is the bankruptcy estate and if it is part of it, how is that affected when the loan is paid off in a year? (Making the assumption that it is and we are unable to trade.) Do we then own the vehicle or what happens to it?

[LadyInTheRed]

When you file BK, your assets become part of the bankruptcy estate until the trustee abandons them or until the case is closed. Because your case is not yet closed, it is possible that you do not have the right to sell your car. What is the delay in closing your case?

You already own the vehicle (subect to any rights the BK Trustee has to it), but the lender has a lien. When the loan is paid off, the lien will be released and you will have clear title and can do what you want with the car, unless the bankruptcy is still open and the car is part of the estate.

[rt31]

Our case was a No Asset case. Would the vehicle still be part of the "estate"? I am signing up with Pacer to see if I can see any reason as to why the case hasn't closed. We also will contact our attorney about the car. I had talked with him earlier this year and asked about the case not being closed and he said not to worry since it was discharged. We too are surprised that we have not received notice of it closing since it's been 13 months since it was discharged.

[rt31]

When you file BK, your assets become part of the bankruptcy estate until the trustee abandons them or until the case is closed. Because your case is not yet closed, it is possible that you do not have the right to sell your car. What is the delay in closing your case?

From what I can tell on PACER is that 15 months BEFORE we filed bankruptcy my sister and I had donated a piece of land to a non-profit organization. This was done prior to my losing my job, but because of the timing it was being investigated as a fraudulent donation. On July 8, 2013, the trustee sent a letter with intent to abandon the claim. In reading the letter it was stated that there was insufficient funds available after the allowable 15% of income was figured to pursue the land. It stated that the creditors had 14 days to contest, but the case is still open.