A bankruptcy can provide a number of benefits for your vehicle(s)—you should read the benefits listed below as they could be very helpful to you TODAY. Many people believe that by filing a bankruptcy they will automatically lose their car, but that is a myth. A bankruptcy attorney can describe which type of bankruptcy is best for you to protect your vehicle and receive certain financial benefits.
Has Your Car Been Repossessed Or Soon to Be?
If your car has recently been repossessed, then filing a Chapter 13 bankruptcy can force the car lender and repo company to return the vehicle immediately so long as we file the bankruptcy within 21 days of the vehicle being taken.
It is important that you contact our office immediately because waiting until the 19th or 20th day may be too late to gather the necessary documents we need to file your case.
If your car is about to be repossessed, then we can file a bankruptcy that will stop any car creditor or repo company from taking the car so long as we make arrangements to pay for the car loan (usually under more favorable terms) —see below.
Changing The Terms Of Your Car Loan
If you file a Chapter 13 bankruptcy, your car cannot be taken from you, and you receive the benefit of paying your car loan off at an interest rate that is generally lower (sometimes significantly lower) with a longer term or duration, which effectively lowers your monthly car payment so that it is more manageable for you.
Also, if your car loan is over 910 days old (2 ½ years) and the value of your car is less than what you owe (upside down on your car), then by filing a Chapter 13 bankruptcy you only have to repay the value of the car rather than the remaining balance due often-times saving you thousands of dollars.
Can You File Chapter 7 Bankruptcy and Still Keep Your Car?
Yes, by meeting certain requirements and signing a reaffirmation agreement promising to continue paying the car loan after the bankruptcy has been filed. Equally important to understand, you can choose to not keep (surrender) your car, or you can choose to keep one car and not the other—speak to your bankruptcy attorney about these options.
Important Disclaimer: The information discussed above and throughout this website should not be relied upon to make any decisions without first speaking to a bankruptcy attorney. There are many intricate rules of law governing bankruptcy with many exceptions to the general rules that could change the advice given by an attorney based on the differing facts in each person’s special set of circumstances. THEREFORE, it is important to discuss any information contained in this website with one of our attorneys before taking any action or refraining from taking any action.