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cfortunato
cfortunato, Attorney
Category: Bankruptcy Law
Satisfied Customers: 8023
Experience:  Bankruptcy professor.
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What about any title loans we have?

Resolved Question:

What about any title loans we have?
Submitted: 1 year ago.
Category: Bankruptcy Law
Expert:  cfortunato replied 1 year ago.

cfortunato :

 


Hi JACustomer,

cfortunato :

Are you asking about car title loans?

Customer:

for chapter 7, I know regarding our home and its homestead our home won't be taken. None of our vehicles can be taken. but what about a title loan we have on a vehicle. How does that and Ch7 work? Sorry for the confusion.

cfortunato :

Thank you for your response.

cfortunato :

Thank you for your response.





12:19 PM



A title loan is treated the same as a mortgage.






12:20 PM



The obligation to pay the loan gets discharged, but the lien remains.






12:21 PM



This means the lender cannot try to collect what is owed, but if the debtor stops paying the loan, the lender can take the car.



Customer:

then how do you remove the lien?

Customer:

Oh nevermind. So they can't call us anymore and we can still pay a little on it at a time until the balance is paid off, correct?

cfortunato :

You cannot remove a title loan lien without paying off the title loan.

cfortunato :

You have to continue paying the title loan as agreed, or the lender can take the car.

cfortunato :

They cannot call you for the money, but they can take the car.

cfortunato :

That is, if you file a Bankruptcy they can no longer call you, but they can still take the car.

Expert:  cfortunato replied 1 year ago.
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Expert:  cfortunato replied 1 year ago.

You cannot remove a title loan lien without paying off the title loan.

You have to continue paying the title loan as agreed, or the lender can take the car.

If you file a Bankruptcy, they cannot call you for the money if you are not making the payments, but unfortunately they can take the car.


 

Customer: replied 1 year ago.
What does ch7 cost? Average?
Expert:  cfortunato replied 1 year ago.
The filing fee is $306. If your income is below a certain level, you can file for free. Otherwise, you can pay the filing fee in 4 installments.
If you want to use an attorney, Bankruptcy attorneys charge around $1,200 to fill out and file the papers. Or you can pay a Bankruptcy preparer around $200 to fill out the papers, and then you can file them yourself.
Customer: replied 1 year ago.

So when you file Chapter 7, where does ones credit score begin at? However, it can't be any worse than it is now.

Expert:  cfortunato replied 1 year ago.
After filing a Bankruptcy, if there is no further negative activity, one's credit score starts to improve in approximately one year.
Customer: replied 1 year ago.

Great! However, does it start at like 400 450 etc.

Expert:  cfortunato replied 1 year ago.
Yes - that is correct. And you can expect it to increase by around 50 points per year. The increase is a slow, gradual increase. (Fast on the way down, and slow on the way up.)
Customer: replied 1 year ago.

That's about right. Hahaha. So is there a MEANS test that we can look at?

Expert:  cfortunato replied 1 year ago.
Yes - here is the Means Test:
http://www.bankruptcyaction.com/Chapter_7_Means_Test_Calculator.php.
Customer: replied 1 year ago.

Now what if he don't do re-affirmation of the truck that is leased? is that an automatic surrender?

Expert:  cfortunato replied 1 year ago.
Re-affirmation is not required to keep a truck. If you want to keep a vehicle, you just have to continue to make the regular monthly truck loan or title loan payments.
Customer: replied 1 year ago.

Here is where I am confused. Can we not include the truck in bankruptcy like we do the credit card debt etc.

Expert:  cfortunato replied 1 year ago.
A vehicle loan is different from credit card debt. A vehicle loan is secured (by the vehicle), and credit card debt is not secured.
Both vehicle loans and credit card debts get discharged in a Bankruptcy, but because a vehicle loan is secured, the lender can take the vehicle if you stop paying.
Customer: replied 1 year ago.

Ok. Thanks. I'm really sorry. This is mind boggling.

Expert:  cfortunato replied 1 year ago.
You're welcome!

It takes time to understand this stuff. (I also had trouble in the beginning.)
cfortunato, Attorney
Category: Bankruptcy Law
Satisfied Customers: 8023
Experience: Bankruptcy professor.
cfortunato and other Bankruptcy Law Specialists are ready to help you

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