Rented water heater

[bkfiler]

it will be considered fraud if he knew he was going to file for bankruptcy and decided to take it that way on purpose. but, given the price of the item and the fact it costs several hundreds of dollars just to file a objection to dischargability of debt and then even more for attorney fees, i would say you have a water heater to keep

[StaciMM]

I disagree about the fraud. Its a rental item that has been in the house for a long time-he didn't obtain it after knowing that he was going to file Bk. He has contacted the creditor to find out what to do-they can't come & get it. He has no option, really.

[bkfiler]

dont be so serious.

[JimH]

Doesn't matter if she turns it over to collections or not-list the debt, it will be discharged.

I intend on doing that, but I'm not sure ownership of the heater will pass to me through the bk.

I have no contract since the previous owners had it installed so I don't know the terms if I go into default. I know from the billing it's some kind of rental agreement, which implies they own the heater and will still own it after the bk. I'm hoping there is something in there that says if I go into default, then I owe $800 for the heater - that implies I now own it and have to pay for it. If I received a demand letter for payment of the heater itself, that would make it pretty clear cut too. Otherwise, I may be obligated to keep renting it or give it back after the bk. I don't want to do either.

[StaciMM]

Regardless-if they wanted it back after BK, they'd have to put money & time into doing paperwork to repossess it. The term 'replivin warrant' comes to mind, but I don't recall the details.

[bkfiler]

im thinking the only thing they could do is considere it secured debt. bu tyou didnt sign anything, except taking over the house - which could mean you excepted the debt.

since it is only $800 and not $80,000 i have a feeling you are the proud new owner of a might fine water heater lol. this little fine points only come up when it matter.

id sign nothing, agree to nothing and just list it at that full price.

[JimH]

list it at that full price.

Won't an $800 water heater will look pretty odd next to a $50 rifle? Plus, that's hogging up all of my exemptions - or are you saying not to claim it as exempt?

[bkfiler]

you arent listing things as each item are you? in exemptions you can group things into categories.

hehe list it in the exemption category? wait now! hold the phone. you want to list it as a debt. you cant claim it in the exemption category already. you can on your next bk filing though

[StaciMM]

I think he meant to list the debt? If it is several years old (or more) then it can't possibly be worth $800 now!

Edited to add-the creditor would be listed as a debt, the item would be listed as an asset.

[AAAArt]

You can certainly discharge the amount owed in Bk, but I'm not too sure about the water heater itself. This is rental property. It dowan't matter how many times you've paid for it with the rent, you still have no equity in it and it belongs to them.
For Example, I "rent" an apt. Over the last 10 years, I have paid approx. $80,000 in rent. If I am 3 monts behind, I can bk and get out from under the past due payts, but they will not let me live here any longer and there is no way that anyone will say, that it was only cost $75,000 to build, so you get to keep it.
At least that's the logic I see as it pertains to your water heater. You don't have to pay them and unless thye get a stay, you don't have to pay them until after the Bk, but you also can't count on them not taking it back. Now, if you had "purchased" it and paid on it, the story might be different. Guess it just will depend on what value they place on it and whether or not it is their policy not to let anyone get away with anything. Best wishes, Art

[StaciMM]

Art you make a good point. The only issue is that there is a process where you can be evicted from rental property, and there is enough benefit (for the property owner) to do that if necessary as they can re-rent, etc. The process to get back the water heater would probably cost more to the owner than it would be worth as they wouldn't be able to do much with a used water heater. They can't just show up and ask for it-would have to file a replevin motion (not warrant-I looked it up) and bear the cost for doing so.

Of course, by not paying it Jim takes a small chance that they WILL file a motion and try to get it back. But, based on what he said in an earlier post, I got the impression that there is local or state law that says a fixture can't be repossessed. Of course, something else to run by the attorney...

[bkfiler]

the item itself a secured debt, nothing else.

he bought the home and assumes the secured debt / responsability for dealing with it.

he can bk it along with the rest of the rental payments on it as one lump sum.

the argument now is only if they will come and get it. no they wont because it costs too much for them to do so.

[JimH]

the argument now is only if they will come and get it. no they wont because it costs too much for them to do so.

I'm not too sure of that because they offered to come take it out. All I had to do was pay the bill current, which I'm not going to do.

[bkfiler]

that was before the bk process. once you list it as debt its a different story.

[StaciMM]

I didn't realize that... It may have been a scare tactic. Regardless, they can't just show up & ask for it. THey could try, but you would be in the right to tell them to get off your property and not come back without the proper paperwork. They'll probably have to hire an attorney to find out what that even includes!

I'm not too sure of that because they offered to come take it out. All I had to do was pay the bill current, which I'm not going to do.