In chapter 7 cases,
Bankruptcy Receivables Management (“BRM”) typically
offers reaffirmation agreements for the retention of
secured collateral, insuring that these agreements are
in compliance with existing bankruptcy law, as well as
any local bankruptcy rule in each jurisdiction.
Reaffirmation agreements are then filed with the
appropriate court and conformed copies are maintained
electronically and permanently stored in BRM’s files.
For courts that have electronic case filing (ECF)
available, BRM files the reaffirmation agreement
electronically and maintains the original agreement
pursuant to ECF requirements.
Another option for
collateral retention in Chapter 7 is for the account
holder to Redeem the subject collateral for its fair
market value. Though this option is not utilized
frequently because it requires a lump sum payment to the
creditor for the fair market value, most secured
creditors are not willing or able to respond quickly
enough to prevent an unjust result in many cases. BRM
closely monitors its assigned cases to insure that all
proposed valuations are considered on their merits, then
through its Nationwide Proprietary
Legal Network,
selectively opposes redemption motions that are not
supported by the facts or by existing law.
The final option in chapter 7 is the
voluntary surrender of collateral. This option is
typically selected by account holders who feel they
cannot afford to retain property after bankruptcy. In
these cases, repossession and liquidation of the
collateral may represent the only opportunity the
creditor has to reduce its loss resulting from the
discharge of an account holder’s obligation to pay the
amount owed. Although many creditors take back their
collateral for refurbishment and resale through various
outlets, some creditors derive benefit from outsourcing
the repossession function. For these creditors, BRM has
created a separate operating unit,
Creditors
Repossession Clearinghouse, that specializes in the
repossession and liquidation of collateral that is to
be surrendered voluntarily by a consumer or small
business.
