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I think you're misunderstanding the situation here, to the extent that you think that the creditor wants to take the truck and that the man somehow benefits by declaring the incorrect county. The second idea can be dismissed quickly; this isn't a repossession, but a bankruptcy case in which the trustee is challenging the lien. The trustee's job is to sell property for the benefit of creditors. The trustee winning the action means the truck is going to get sold and the proceeds distributed among all the creditors named in the bankruptcy; the man doesn't get to keep the truck.
The other point is a bit more complicated, in that the creditor winning this action actually increases the chances that the man gets to keep the truck. If the creditor has a security interest in the truck, and there isn't enough equity for it to be worth it for the trustee to sell it, then the creditor has four options:
He can ask the debtor to reaffirm the debt. The bankruptcy won't extinguish the creditor's security interest, but it will extinguish the debtor's personal obligation to pay. It's fairly common for bankrupts to have auto loans well in excess of the vehicle's value. After a reaffirmation the loan survives the bankruptcy, and the debtor continues to be personally liable for it, meaning that if they don't make the payments it could continue to affect their credit score and the creditor can continue to take collection actions (phone calls, letters, etc.). They can still repossess the car, and continue to hold the debtor for accountable for any shortage. They can go after the debtor's other assets to the extent that state law allows. This is almost always what auto creditors want you to do. When I did bankruptcy, debtors would occasionally ask about this because they needed a car and were pessimistic on their ability to get an auto loan after discharge. I told them up front that if they insisted on this they'd need to find another attorney, because I wouldn't do it, and trustees, who have to act in the best interests of the debtor as well as the creditors, have to approve and they're increasingly reluctant to allow these agreements outside of the rare cases when they make sense.
The creditor can repossess the truck. This happens fairly often, but not as often as you'd might think. Again, a lot of car loans are underwater, so getting the car is a consolation prize. Furthermore, the creditor has no idea what kind of condition the vehicle is in, mileage, etc. And repossession isn't free. They have to hire a tow truck to pick up the car. They then have to find somewhere to store it, assuming the bank manager's house isn't an option. It's probably going to be sold at a dealer auction, where it won't fetch anywhere near it's market value. The fact that the truck in this case is a commercial vehicle complicates things even further, as the incidental costs are larger, the market is smaller, and things like DOT safety standards make it third-party purchase riskier. Again, it's a consolation prize.
The creditor can redeem the truck. This is only available in the event that the loan is underwater. Say he owes $50,000 and the truck is only worth $30,000. If he can come up with $30,000 cash he can have the truck for that amount. This is a better deal for the creditor than repossession, since it avoids all of the incidental expenses and risk of selling below market. The downside is that it requires the debtor to come up with a lot of cash at a time when they, almost by definition, aren't doing well financially. It makes the most sense when the vehicle is only worth, like, a few thousand dollars that the debtor can save up while the bankruptcy is pending. There are also companies that offer redemption loans, but these almost always have ridiculously high interest rates, though they may be worth it if the car is worth keeping.
The final option is called a "ride through". This was technically eliminated by the 2005 bankruptcy reforms, but it's made a comeback in the form of the "back door ride through" and the realities of the situation. It used to be that the bankruptcy code prohibited a creditor from seizing collateral after discharge, so long as the loan was current. What this meant was that, if the loan was current at the time of filing, you could just continue making payments and keep the car. Since there was no formal affirmation, if you couldn't afford the payments or just wanted a new car, you could stop paying at any time without detriment to your own financial position. While the bankruptcy code no longer affords debtors this protection, a number of state laws still prohibit creditors from seizing collateral when payments are current. Furthermore, remember that repossession isn't free. The banks pushed for this reform because they thought it would lead to more affirmations. It actually led to more repossessions.
Unfortunately for them, this push was based on what they thought they wanted, but after several years it became clear that the economics didn't make sense. It costs the banks about $500 per reaffirmation in legal costs and filing fees. So 100 affirmations costs them $50,000. If the default rate is 10%, then it's costing them $50,000 to pursue ten delinquencies. And what do they actually get for that? Well, they already had the right of repossession, so all they're really getting is the right to sue people who filed bankruptcy in the past few years. Tack on more legal fees, and add into it the fact that most of these people aren't going to have many recoverable assets, and it doesn't look too good. Even in the best case scenario, where they can collect every judgment in full and there are no additional legal fees, it's unlikely that the total value of the suits is going to add up to what they paid—they could be paying $50,000 for the right to collect $30,000. And since reaffirmation is such a bad deal for the debtor, they're now forced to repossess on a lot of loans where they might have otherwise been paid in full.
So in addition to your attorney warning against it and the trustee skeptical at best, we now have the situation where reaffirmation might not even be an option. I know that Ford Motor Credit still follows the letter of the law and insists on reaffirmation, and local credit unions often do because of complicated cross-collateralization agreements and the fact that they seem to take things personally. But otherwise, most debtors who aren't behind on payments end up keeping the car.
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