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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?

This answer was rated:

What about any title loans we have?

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.

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 4 years ago.
What does ch7 cost? Average?
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 4 years 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.

After filing a Bankruptcy, if there is no further negative activity, one's credit score starts to improve in approximately one year.
Customer: replied 4 years ago.

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

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 4 years ago.

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

Yes - here is the Means Test:
http://www.bankruptcyaction.com/Chapter_7_Means_Test_Calculator.php.
Customer: replied 4 years ago.

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

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 4 years ago.

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

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 4 years ago.

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

You're welcome!

It takes time to understand this stuff. (I also had trouble in the beginning.)
cfortunato and other Bankruptcy Law Specialists are ready to help you