Motion to Redeem
There are instances when a Debtor can convert his case to a Chapter 7 and only pay the value of a vehicle. There is a motion that can be filed with the court called a Motion to Redeem that required a car creditor to turn over the title of a car even if only the value has been paid in a Chapter 13.
The main things to look at are if the Debtor was paying the value of the vehicle in his Chapter 13 plan. He cannot go from paying the full claim to only paying the value by converting to a Chapter 7. His plan must have been confirmed with a set value for him to be paying on the vehicle. The other thing is that the Debtor must have paid the full value of the car in the Chapter 13 bankruptcy, or at least the majority of the value. If there is a small balance to be paid on the value, the Debtor will be required to pay the amount in a lump sum to the car creditor in order to get the title to the vehicle.
The Motion to Redeem must be filed with the court and served on the car creditor. The Creditor then has 20 days to object. If no objection is filed, the court will sign an order requiring the Creditor to turn over the title once the full value has been paid. The motion is generally used when the full value has already been paid or there is just a couple hundred dollars left to pay of the value.
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