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  1. #1

    Default Registration Loans and Chapter 13 Bankruptcy

    My question involves bankruptcy in the state of:AZ Under Chapter 13 , does the interest rate on a registration loan remain the same, or can it be lowered in the repayment plan?

  2. #2

    Default Re: Registration Loans and Chapter 13 Bankruptcy

    It can be lowered, if you ask for it in your plan. The lender can object, and then it will be up to the judge.

  3. #3

    Default Re: Registration Loans and Chapter 13 Bankruptcy

    Thank you so much. I appreciate your time to help me....maybe it's not said enough on here...but you are all amazing the way you give your time to help people who are just needing a little help and information. Thank you again.

  4. #4
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    Sep 2010
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    Default Re: Registration Loans and Chapter 13 Bankruptcy

    Yep, the rate can be "cramdowned." A registration loan is unsecured (unlike a title loan). It could be reduced to nothing (secured loans get reduced to a few points over the current prime).

  5. #5

    Default Re: Registration Loans and Chapter 13 Bankruptcy

    I had never ever used anything like this, so it was hard to distinguish in my research.....because there are payday loans, title loans, registration loans and personal loans...so now I have some idea. You guys are just awesome. I wish I could give you some advice....cooking, baking, gardening, arts...I'm your gal. lol

  6. #6
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    Sep 2010
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    Default Re: Registration Loans and Chapter 13 Bankruptcy

    It's not a matter of it being personal or not. The question is whether there is a security interest or not. A regular car loan, a title loan, a house mortgage, etc... all are secured by some property (a house, a car, whatever). The bank can come take the property (repo the car, foreclose on the house) if the loan is not paid. A payday loan, credit cards, registration loans, and most other debts are unsecured. There's nothing to back up the loan but the borrowers ability to pay.

    Secured loans can have their rates dropped to the prime plus a few points (three I think). Unsecured loans can have their rates dropped to zero.

  7. #7

    Default Re: Registration Loans and Chapter 13 Bankruptcy

    If the same person here were to file Chapter 7 BK instead of the 13 (still in decision making mode here), would the same registration loan be considered unsecured, or considered secured allowing the lender to repossess their vehicle? I am thinking 7 would be better for them, however they think they may be able to keep their car if filing 13 instead, and also be able to make payments to their attorney with the 13, they believe. I am helping them out with gathering information, but they are going to hire an attorney to handle their BK. The only way to be sure it is done right and there are no complications for them.

  8. #8
    Join Date
    Sep 2010
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    467

    Default Re: Registration Loans and Chapter 13 Bankruptcy

    If they have an attorney he or she is the best person to answer their questions.

    As it relates to Title vs. Registration loans, they need to be sure there is no lien on the title (other than a purchase money lien - I assume they owe for the purchase). Liens in Arizona are not necessarily placed on the physical title especially if the purchase money lender has possession of the title. Liens can be electronically recorded. They should be able to check on the status of their title with the ADOT - Motor Vehicle Services.

    Des.

  9. #9
    Join Date
    Sep 2010
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    18,910

    Default Re: Registration Loans and Chapter 13 Bankruptcy

    The class of bankruptcy doesn't change whether it is secured or not. Further, in either case, there is usually a stay against foreclosure/repo while the bankruptcy is active unless the lender can make a good argument as to why the stay should be lifted.

  10. #10

    Default Re: Registration Loans and Chapter 13 Bankruptcy

    So, if this couple had a lien on their vehicle that had been there for some time, due to a huge amount of money they owed, and then they got 2 registration loans, could the lenders from the 2 registration loans be able to repo the vehicle, even with the first lien in place? I am wording this the best way I know how...I hope it's understandable. They showed me their title..and at the bottom it states: "THIS VEHICLE TITLE IS NOT ELIGIBLE FOR TRANSFER - USE THE CONTACT ADOT AT WWW.AZDOT.GOV TO ASK FOR MORE INORMATION". So, I cannot figure out how the lenders of the two different registration loans would extend credit with that in place. This lien, which I understand is for a huge amount of money (over $100,000.00)....and must be electronically filed. But, they both said that they scanned the title for the two lenders. Unless the lenders really considered the title of any great importance in the first place. Perhaps this is just a legal way to extend credit to consumers as a "payday" loan. That is what it is beginning to look like to me. I thank you in advance, once again, for your help.

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