Situation:
- Debtor filed for Chapter 7 Bankruptcy.
- Lender got relief from the stay and an order to allow them to repossess the car from Debtor.
- Lender filed a 2-page motion asking the Court to approve their motion to have the Debtor physically return the car to the Lender.
Outcome:
- Court denied the motion.
- The Court stated that there is nothing in the bankruptcy code requiring a debtor to surrender collateral to a creditor.
- When the Lender received stay relief and rights to regain the car, the car was no longer property of the estate (bankruptcy).
- Lender can take whatever action as to such property as is permitted by applicable non-bankruptcy law.
Basically, the lender has to go out and get the vehicle and debtor is not required to bring the car to them.
