Did you take out a title loan in Texas and now find yourself unable to pay it? About to lose your vehicle to repossession by a title lender? Your lender or loan broker may have violated consumer protection laws, that could result in a cancellation of the title loan.

In a lengthy opinion, U.S. Bankruptcy Judge Marvin Isgur found several violations of state and federal law in a title loan transaction that he was examining because an Objection to Claim had been filed in a bankruptcy case. The Court disallowed the claim of United Texas Investors, LLP (UTI) because it violated the Texas Credit Services Organization Act (CSO Act) and therefore the transaction was a constructively fraudulent transfer under Sec. 548(a)(1)(B) of the Bankruptcy Code.

What can this mean for you? It means that if your title loan has some or all of the same flaws as this one did, and you file chapter 13 bankruptcy, your lawyer may be able to not only save your car or truck from being repossessed, but may be able to get the lien off of your vehicle and cancel the debt. There are powerful consumer protection laws in Texas that protect people, but your lawyer needs to be aware of the laws and the court decisions that interpret them.

J Thomas Black
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Board Certified, Consumer Bankruptcy Law- Texas Board of Legal Specialization
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