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02
Feb
2018

No Reaffirmation: Debtor Keeps Collateral

A Chapter 7 debtor, who was not in default under the obligations of a consumer loan agreement, was not limited to redemption, reaffirmation, or surrender of the collateral.

Here, the the court held that a Chapter 7 debtor could keep his vehicle pledged as collateral to the creditor, even though the debt was not reaffirmed, redeemed or surrendered to the creditor.

Instead, the debtor could retain the collateral and continue to pay under the original obligation until the full amount due was paid.

If the debt becomes delinquent, the creditor may take possession of the collateral (once no bankruptcy stay is in effect).  Matter of Windham (Bkrtcy.M.D.Fla., Judge Thomas E. Baynes, Jr.).

Author: By Charles R. Harroun, Attorney at Law



This entry was posted on Friday, February 2nd, 2018 at 4:32 am and is filed under Bankruptcy, Mortgages, Secured Loans. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

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