Post Chapter 7 - Collections

It's my guess that once a debt gets discharged and the creditor doesn't place its claim over it on time descried in the bankruptcy laws then they can't come after the debtor later. Their rights to collect that debt get forfeited. Anyway, you must get things clarified by the bankruptcy lawyer.

Quote:

My husband and I filed a Chap 7 that was discharged in Feb 1990. Part of the discharged debt was an account for some mini-blinds we had ordered for our house. After discharge, the mini-blind company wanted us to surrender the blinds. Our attorney said, sure, let us know when you want to come pick them up. We never heard back from them.
Hopefully, that will be the same with you. Good luck.

Just tell them you no longer have the property....or it broke and you threw it out.

Thanks for the info and advice. I called and left the collections person at Bass & Associates a brief message. I followed-up with a certified letter asking them to produce documentation proving that they are authorized to collect this debt, their client has a valid lien on the consumer goods, all account activity, a list of the consumer goods, and proof that I entered into an agreement with Best Buy in the first place. We'll see if I get a response to this request. They would have been better off to address the redemption offer I made them 10 months ago before the debt was discharged.

Oh, boy. Bass & Ass. Soaplady's advice oughtta work pretty well with those clowns. Assuming they're able to answer your validation, which they most likely won't be.s

hang on a second here--

You seem to be speaking as if this debt were secured with the items in question. This is not a mortgage, I am guessing youre talking about a store credit card, right? I am not 100% on this, but items bought on a credit card does not constitute a secured loan. Therefore, they do not have any right to try to claim those items now. A secured loan would be initiated with the property in question being included in the documentation as being used as collateral to secure the debt. Unless there is some provision in the original credit agreement, I dont see how that could be the case here.

Agian, I am not 100% on this but I think they are just blowing hot air at you. Please, someone correct this if I am mistaken, thanks.

That's a very good line of reasoning, Jon (said the Wulf who didn't think of it himself). And, I think you're right. As a litmus test, it should be simple enough to pull up a copy of their current cardholder agreement off of their website. Might show us which way the breeze is blowin'.

Not I, though. I'm for bed. I'll tackle this in the AM, if you don't beat me to it.

when i filed i believe my lawyer said something along those lines, too.. that if used on credit they could not try to claim items. let us know if you find anything out but knowing that company they are just trying to scare you.

OK... BestBuy, got the terms & conditions squirreled away behind the application page. I don't want to know that badly.

Thanks all for your input. Yes, it's Best Buy. Basically the debt is secured by the electronic merchandise that I purchased. Best Buy sold the debt shortly after I filed for the Chapter 7, then I started receiving correspondence from Bass & Associates who represent ECAST. I offered them a redemption but they never responded either to accept or reject so the bankruptcy was discharged and this left unresolved. I had another store card for a furniture store and reaffirmed that debt and almost have it paid off.
Bass & Associates may be blowing smoke but I thought I should get something documented with them in case they try to pursue this. The merchandise that I have is the only thing they are entitled to; the monetary part of the debt was aleviated in the discharge but the debt still exists because of the consumer goods. Even if they get fair market value from me it wouldn't be much. Hell, I already offered them $$ for the stuff!
I will probably have a little work to do to get this squared-away on my credit report because it shows that this debt was transferred/sold not inactive as the others are because of the discharge. I may dispute it to see where that goes.
My prediction is (and it may be wishful thinking) is that Bass will realize at some point they are wasting a lot of time for a handful of old electronic devices and let it go.
As a sidelight, I found some pretty interesting articles on companies that buy-up this old debt. ECAST and it's sister company Max Recovery in the UK are owned by Bear Sterns. I also read a pretty informative post on this site regarding companies that buy junk debt.
Well, time to enjoy another rainy Saturday!

If you read your cardmember agreement (obviously they vary by company), or sometimes it's stated on the store receipt you sign, you are usually giving them a security interest in any goods you purchase until paid. To that effect, that could claim that they want the cans of soup back that you charged up at the grocery store.

It really is a bunch of legal jargon with no means for them to actually enforce. That is because, as I said above, they never perfect their security interest by filing a UCC-1. If they truly wanted a court to recognize their lien on some electronics you bought, they'd have to file a UCC with the Secretary of State. (And per BK laws, if you go BK before they perfect their lien, then they have no lien and can't take action to perfect without a court order.)

Have fun with them all you want, their bark is a lot worse than their bite -- they're not really going to try to repossess some worthless junk. Or send them a C&D letter.

I stand to correct myself a little. I am reading that security interests on open-ended charge accounts only apply where there is a purchase-money security interest (PMSI). For example a store card, where the store itself actually extended the credit. In the case where you charge to Visa/Mastercard, the store is not extending credit, and so there is no PMSI.

Bottom line in this case, mainly, was it a Best Buy Store Card, or was it the Best Buy Mastercard issued by HSBC? Store card = they have rights to the property, Mastercard = they don't.

I'll look into the actual laws a bit later so I can understand better myself, but the following is where I found this information:

[quote="bankruptcy.lawyers.com/Security-Interests-in-Bankruptcy.html"]
Purchase Money Security Interests

These security interests are lien rights that the seller takes in purchased goods when the seller finances the purchase. The lien can be created by a specific written agreement or may arise when the item is financed on the seller's revolving credit or store credit card. This kind of lien does not have to be recorded through the usual filing of a Uniform Commercial Code (UCC) financing statement.
In theory, even if the buyer steers clear of liability on the debt through bankruptcy, the seller still has the right to reclaim the goods. The usual office supply store credit plans give the seller a security interest in the goods purchased. But if you buy the same goods using a Visa or MasterCard (credit provided by a lender other than the seller), you get clear title to the goods. Even if you avoid your liability on the credit card through bankruptcy, the goods charged to the card are yours, free and clear of any security interest in favor of the seller or the credit card issuer.
Purchase money security interests can be avoided or "stripped down" to the current value of the purchased goods in Chapter 11 and 13 bankruptcies.
Creditors with purchase money security interests in goods with lower value almost never file a lawsuit to enforce their interest in the goods. They are not really interested in the goods. They rely on the debtor's fear of repossession to "encourage" debtors to pay for things with little present market value.[/quote]

I know that all 3 of teh Sterling Jewelers cards that I have had that in their cardmember agreement and on the sales receipts

Yes, it's a Best Buy Store Card and that is precisely the language that Bass has used in their correspondence: purchase-money security interest. I really don't expect them to come after the stuff. I did check and Bass is licensed to collect in my state. If they continue a line of communication after the letter I sent to them I want to resolve this. I didn't try to beat them out of the goods, I actually offered $$ before the discharge and did not get a response. Any big ticket items I have are 2-4+ years old by now so the fair market value is pretty low. This account is the only one I had any problems with. For now this is only a very small bit of aggrevation; kind of like that fly that hangs around the picnic table.

Please let me know how this turns out for you. I just received the same letter, too.

Question for likestoride.....How did this work out? We are dealing w/ an identical issue...Bass & Associates/Best Buy. We are discharged since June 2010, but receiving letters & calls NOW from Bass & Associates. My lawyer is, conveniently, no longer w/ the firm & the person I have been passed on to seems to know little to nothing about my rights and/ or what recourse I can or should take in this case. They(BK law office) can't seem to tell me if I NEED to surrender the electronics or offer some sort of settlement. I thought once things were discharged, IT was over. I plan on following the action advised for you to do along w/ a certified letter asking them to produce documentation proving that they are authorized to collect this debt, their client has a valid lien on the consumer goods, all account activity, a list of the consumer goods, and proof that I entered into an agreement with Best Buy in the first place.

Please let me know how your situation ended. I'm pretty concerned w/ this situation b/c I don't want someone showing up at my house & /or fighting w/ me at my door in front of my children.

All you have to do is call and give them the bankruptcy info and filing date..


If they ask if you have the products, so no. It broke, it was a gift, you sold it....

Tell them to bug off and never contact you again.