Personal loan with house furnishings as collateral

November 8th, 2009 by Questions

I owe $15,000 from Citifinancial with my house furnishings as collateral (TV, sofa, beds, and a car that has been sold). I don`t live in my house now as I have separed from my husband. My husband is buying me out of our house, and is being finalized. He is keeping everything in the house and I am getting $10,000 from this arrangement. If I file for bankruptcy, would my loan with Citifinancial be included considering that it is a loan with collateral? If not, can Citifinancial seize those furnishings if I no longer have interest on those anymore?

Posted from: Ontario

Questions

One Response to “Personal loan with house furnishings as collateral”


November 09, 2009 at 10:08 am, Barton Goth - Goth & Company Inc. -Trustee in Bankruptcy said:

Technically speaking a bankruptcy deals with your unsecured creditors, not one’s who havew collateral.

So if you file for bankruptcy and cease making payments to Citifinancial, they retain the right to seize anything that has been pledged on the loan (i.e.TV, sofa, beds, and a car that has been sold) and this is irrespective of whose possession they are in. If Citifinancial decides they are not interest in picking up the collateral then the forfit their rights to the property and are cleared by the bankruptcy.

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