Secured Creditors

November 11th, 2007 by Questions

A secured creditor has threatened to come and take household items used as security. During bankruptcy, is there an orderly process for this? Does the trustee have to give the OK for any secured household items to be released or should one just be ready for a truck to show up? By law must any written formal notice be given?


One Response to “Secured Creditors”

, A licensed trustee said:

This answer may be different depending on where in the country you reside.

If you pledged certain items of furniture as collateral for a loan and you have defaulted on the loan then the creditor likely has a right to come and seize (then sell) the items you pledged as collateral.

If you have filed an assignment in bankruptcy, the creditor will be required to prove to your trustee that they have processed all of their paperwork properly – if they have your trustee will inform them that they have a right to your stuff.

If you haven’t filed for bankruptcy yet then I suggest you take your loan documents with you to see a trustee and they can explain the process where you live in detail BEFORE you file.

If you have already filed, give your trustee a call and ask them to explain all of this to you (again).

Please post a follow up comment below:

(Note: comments are reviewed by moderators and then posted after approval. In addition, due to high volume some of the comments might not be posted.)