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    Effective July 1, 2012, Title 750 of the Indiana Administrative Code will reflect amendments to the dollar amounts in the Uniform Consumer Code, home loan practices, and bankruptcy exemptions. ...
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CLIENT ADVISORY

Amendment to Indiana Administrative Code to Change Dollar Amount on Collection of Deficiency Balance

Published Tuesday, May 8, 2012 7:00 am

Effective July 1, 2012, Title 750 of the Indiana Administrative Code will reflect amendments to the dollar amounts in the Uniform Consumer Code, home loan practices, and bankruptcy exemptions.  As this rule also pertains to the collection of deficiency balances, IC 24-4.5-5-103(7), the dollar amount requirement has been increased from $3,500 to $3,600.  This means that, in order for a creditor to pursue the collection of a deficiency balance, the value of the collateral must be $3,600 or greater at the time the contract is entered.

Please keep in mind, however, that if the value of the collateral is less than $3,600 on the date the contract is executed, a creditor has two options to satisfy the outstanding defaulted balance: (1) a creditor may seek to repossess the collateral as full satisfaction of the debt, or (2) a creditor can elect leave the collateral in the debtor’s possession and collect on the outstanding balance of the contract.  In either case, a creditor is barred from pursuing the collection of a deficiency balance which remains after the repossession and sale if the collateral at issue is valued at less than $3,600 on the date the contract was executed.

If you have any questions regarding the amendment to the Code or other methods of maximizing your accounts receivables, please feel free to contact Welch & Co., LLC Attorneys at Law at (765)282-9501.

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