Can I Keep My Car if I File Bankruptcy?
In most cases, you will not lose your car during your bankruptcy case as long as your equity in the vehicle is fully exempt. If you have taken out a loan that has been secured by your car (meaning you promised the lender it could have your car if you failed to pay the loan back), bankruptcy does not make that security interest go away. If you don’t make your payments on that loan, the lender may be able to take and sell the car, during or after the bankruptcy case.
If you are not behind on your loan payments, you may be able to keep your car if you agree to keep making payments. You may even be able to negotiate a lower principal amount, based on what your car is actually worth. If you are behind on your loan payments, you may want to file a Chapter 13 bankruptcy petition. Chapter 13 bankruptcy may allow you to pay what your car is currently worth versus what your loan amount is. Chapter 13 also allows you to catch up on your back payments and bring the loan current.
Whether or not you’ll lose any property when you file bankruptcy can depend on a variety of factors and hiring a competent attorney can make a big difference. To learn more about whether or not Chapter 7 bankruptcy or Chapter 13 bankruptcy is your best option, schedule your free, confidential bankruptcy consultation with a bankruptcy attorney today. Our online scheduling system allows you to schedule bankruptcy consultation at a time that is convenient for you.
