What to do if I filed a Chapter 7 that was discharged 6 months ago but now my car lender has asked for an Order of Relief?

This is to force us to pay the balance owing for vehicle which was included in the bankruptcy filing and was approved. They are using the 4001 Rule. What usually happens in such a matter?

Asked on August 9, 2013 under Bankruptcy Law, Arizona


Terence Fenelon / Law Offices of Terence Fenelon

Answered 7 years ago | Contributor

The discharge may have cleared your personal liability to the creditor, but the lien on the property, your car survives.  The lien either has to be paid or you must surrender the vehicle.  Did you enter into a reaffirmation agreement, and if so, is it being complied with?  If the answer to either of those questions is no, then the lender has a valid lien and they can repossess the vehicle.

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