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  1. #1
    Join Date
    Jun 2017
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    4

    Question After Bankruptcy Can the Lender Reposses My Car with No Perfect Lien

    My question involves bankruptcy in the state of: VA
    During my Bankruptcy process the bank identified as the lien holder on my car title merged with another bank and changed their name to the new bank's name. I listed both banks and the car on my list of debts and creditors. Once I received my letter of discharge I received a letter from the new bank asking me for the car title or any evidence of a perfect lien. I checked my credit report and both banks show this debt as 100% paid off and the loan closed. When I went to DMV the title still has the original bank listed as the lien holder. If there is no perfect lien for the new bank, title still list old bank as lien holder and bank no longer exist, and the loan is discharged what can I do? Can I ask DMV for the title, will car be repossess, or do I get a perfect lien for the new bank? What are my options?

  2. #2
    Join Date
    Nov 2013
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    7,056

    Default Re: After Bankruptcy Can Bank Reposses My Car with No Perfect Lien

    Have you asked you bankruptcy attorney what to do? Seems like someone failed to notify the parent bank.

  3. #3
    Join Date
    Jun 2017
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    4

    Default Re: After Bankruptcy Can Bank Reposses My Car with No Perfect Lien

    When I filed for bankruptcy the parent bank had already merged with another bank. Both banks were also listed as creditors so notified of the pending bankruptcy. The new bank didn't request nor file for a perfect lien after the merger so the lien against the car is still in the original or parent bank's name

  4. #4
    Join Date
    Jan 2006
    Posts
    38,867

    Default Re: After Bankruptcy Can Bank Reposses My Car with No Perfect Lien

    Are you suggesting the bank simply gave up the collateral and accepted the debt as being discharged?

    or;

    did theu demand the vehicle be turned over to them


    or;

    you reaffirmed the loan?

    banks don't usually give up the collateral and the money both.

  5. #5
    Join Date
    Mar 2013
    Posts
    18,340

    Default Re: After Bankruptcy Can Bank Reposses My Car with No Perfect Lien

    Quote Quoting Mike1963
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    When I filed for bankruptcy the parent bank had already merged with another bank. Both banks were also listed as creditors so notified of the pending bankruptcy. The new bank didn't request nor file for a perfect lien after the merger so the lien against the car is still in the original or parent bank's name
    Read your loan contract and find the part where it says that you are obligated to the bank, its successors and assigns.

    That means the new bank has the lien even though you've discharged the debt.

    Whether they come get the car or not is anybody's guess.

  6. #6
    Join Date
    Jun 2017
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    4

    Default Re: After Bankruptcy Can Bank Reposses My Car with No Perfect Lien

    First thank you for responding to this post.
    No I'm not suggesting that the bank just gave up the collateral and accepted the loan as discharged. However I am saying that the new bank fail to seek a perfect lien after their merger and tried to obtain one doing bankruptcy proceedings which I believe they are not suppose to contact me. They have not tried to repossess nor demand the car return. I didn't reaffirm the loan either.
    Bankruptcy Timeline:
    Purchased car - 2015
    Bank "A" merged with bank "B" and changed name to bank "B" - May 2016
    Filed for Ch 7 - Jul 2016
    Meeting of creditors - Aug 2016
    Bank "B" request for perfect lien - Oct 2016
    Discharge of debtor - Nov 2016
    DMV still list Bank "A" on title and lien holder - Jun 2017
    Unfortunately I cannot find the contract for the purchase of this vehicle

  7. #7
    Join Date
    Sep 2010
    Posts
    19,901

    Default Re: After Bankruptcy Can Bank Reposses My Car with No Perfect Lien

    The lien was "perfect" when it was recorded. Subsequent assignations and your bankruptcy, etc... didn't change that.
    You can tell the bank to go research their own paperwork. However, without a reaffirmation, they're free (once your bankruptcy is discharged or the stay is otherwise lifted), to repo it.

    They're not supposed to try to collect the debt during the bankruptcy (or repo the car) but they are allowed to ask for information. If you have an attorney, you can just direct such requests to him.

    I'm not sure what you are trying to do.

  8. #8
    Join Date
    Oct 2014
    Posts
    8,238

    Default Re: After Bankruptcy Can Bank Reposses My Car with No Perfect Lien

    If the lien was perfected when the first bank did the loan transaction then it is still perfected now. As a result of a merger, the surviving company takes over all assets and liabilities of the company it is acquiring by operation of law. Thus, the new bank succeeds the old one as the owner of the debt and all its rights associated with it, including being the successor the lien interest in the vehicle. It is not required that the new bank get its name on the lien. Your personal liability for the debt would be discharged in the bankruptcy, but the lien would still remain on the car.

  9. #9
    Join Date
    Mar 2013
    Posts
    18,340

    Default Re: After Bankruptcy Can Bank Reposses My Car with No Perfect Lien

    Quote Quoting Mike1963
    View Post
    They have not tried to repossess nor demand the car return. I didn't reaffirm the loan either.
    Then you get to drive the car forever if they don't want it.

    Quote Quoting Mike1963
    View Post

    DMV still list Bank "A" on title and lien holder - Jun 2017
    It'll stay that way. When you decide you don't want the car anymore, nobody will buy it with the lien on it and the bank will have no obligation to lift a finger to release the lien.

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