21
Jun
2021
Bankruptcy Redemption Requires Lump-Sum Payment
Bankrupt Debtor may only redeem collateral in one payment. Redemption installment payments prohibited if debtor elects to retain vehicle.
Here, debtor sought to redeem Ford Motor Credit collateral by paying installment payments for the value of the vehicle, instead of one lump-sum redemption payment.
Section 722 of the Bankruptcy Code provides, in pertinent part:
An individual debtor may, whether or not the debtor has waived the right to redeem under this section, redeem tangible personal property intended primarily for personal, family, or household use, from a lien securing a dischargeable consumer debt . . . by paying the holder of such lien the amount of the allowed secured claim of such holder that is secured by such lien.
Debtor sought to repay Ford Motor Credit by paying the value of the vehicle in installments to the creditor.
The court, however, held that debtor may only redeem the vehicle by paying one lump-sum payment to the creditor. In re Diana Tucker, 158 B.R. 150.
Author: Charles R. Harroun, Attorney at Law
This entry was posted
on Monday, June 21st, 2021 at 7:28 am and is filed under Bankruptcy, Mortgages, National, Secured Loans.
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