QUESTION
I have 4 loans through 1 bank and plan on bankruptcy, can they repossess my vehicle with them even if current on payments?
Asked on Jul 30th, 2013 on Bankruptcy - Florida
More details to this question:
I have four loans, all with the same credit union. Two are credit cards, and two are vehicle loans. I plan on filing bankruptcy soon on both credit cards and one of the vehicles, but I want to keep one of the cars. The payments are low and affordable, and I'm completely current and caught up on it. Can they still repossess the car that I'm current on?
13 ANSWERS
Bankruptcy Attorney serving Florissant, MO
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Law Offices of Thomas Corcoran Phipps
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They shouldn't repossess it if you are current on the payments. You can read the loan documents to make sure what they have to do to repossess the vehicle.
Answered on Aug 13th, 2013 at 10:13 AM
Bankruptcy Law Attorney serving Austin, TX
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Law Office of Susan G. Taylor
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Credit unions consider all accounts cross-collateralized. Yes, they can take your car. Best to refinance it with someone else before filing or sell it.
Answered on Aug 08th, 2013 at 1:19 AM
Commercial Bankruptcy Attorney serving Davie, FL
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Law Office of Jeffrey Solomon
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Many credit unions have "cross-collateral" agreements. This means that all loans are secured by all other loans. So your credit card or signature loan might also be secured by the car. You should consult an attorney and discuss possible chapter 7 or chapter 13 in light of the possible cross-collateral agreement.
Answered on Aug 08th, 2013 at 1:19 AM
Chapter 7 Bankruptcy Attorney serving Appleton, WI
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Sisson & Kachinsky Law Offices
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You should be able to reaffirm, however I need more info to give you a correct answer.
Answered on Aug 08th, 2013 at 1:19 AM
Deborah F. Bowinski
You should consult with a lawyer. The answer will depend upon the situation.
Answered on Aug 08th, 2013 at 1:19 AM
General Law Attorney serving Cherry Hill, NJ
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Mark S. Cherry, Attorney at Law, PC
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You can reaffirm the loan that secures the car unless they cross collarealized the loans.
Answered on Aug 08th, 2013 at 1:19 AM
Credit unions loan documents typically contain "cross-collateralization" clauses, which essentially provide that the collateral for one loan serves as collateral for every other loan that you have with the credit union. If this is enforced by the credit union (and there is no reason to suspect that they won't), the vehicle that you are "current" on could be repo'd if both car loans are not paid.
Answered on Aug 08th, 2013 at 1:19 AM
When you have a car loan with a credit union, all your other loans are tied together under a policy called "cross collateralization." To keep the vehicle will require that you pay off all loans to that institution to obtain title to the vehicle. The credit union may not repo the vehicle, but do you really want to pay off a vehicle without being able to obtain the title?
Answered on Aug 08th, 2013 at 1:19 AM
General Practice Attorney serving Coeur d'Alene, ID
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Michael B. McFarland, PA
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It may depend upon whether the credit union is cross-collateralized on the vehicles. An experienced bankruptcy attorney should be able to tell from the paperwork on the loans whether he can reaffirm on just the one vehicle. He may also be able to restructure the debt through a chapter 13. Again, the best option is to get a consultation with an attorney before things get worse.
Answered on Aug 08th, 2013 at 1:19 AM
Trusts and Estates Attorney serving Jacksonville, FL
Partner at
Law Office of David M. Goldman PLLC
3 Awards
When it comes to credit unions, are the loans cross-collateralized? If so, that would play a role in the answer of your question, where the credit card balances would be added to the auto loans.
Answered on Aug 08th, 2013 at 1:19 AM
Richard hirsh
It is possible that the lender could repossess the vehicle even if payments are current unless you reaffirm that debt. However, most auto lenders do not seem to repossess if the payments are current.
Answered on Aug 08th, 2013 at 1:19 AM
Credit Unions often have a "cross-collateralization" clause in their contracts. If this clause is in the contract for one of the car loans (it is probably in both car loan contracts), then the car that is collateral for that loan is also collateral for the credit cards and any other debts you owe the credit union. That means that you will not get the title to the car until all those debts are paid in full. And, if you default on any of those debts the credit union has the right to repossess the car. In some circumstances, if you have had the car loan for long enough you might be able to "cramdown" the credit union debts in a Chapter 13 bankruptcy, where you end up only having to pay the credit union the current market value of the vehicle.
Answered on Aug 08th, 2013 at 1:19 AM
Bankruptcy Attorney serving Plantation, FL
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Moffa & Breuer, PLLC
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Credit unions are a BIG problem.
Answered on Jul 31st, 2013 at 8:34 PM