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Do Not Be Overwhelmed By Your Debts

Bankruptcy might prevent vehicle repossession

On Behalf of | Sep 7, 2018 | Firm News, Property and Asset Forfeiture |

When you don’t make the required payments on your vehicle, there is a chance that it will be repossessed. This is a difficult situation for most people, but it is especially troublesome if that is your only vehicle. Fortunately, there are some ways that you might be able to save your vehicle from being taken.

You might be able to work out a deal with the lender to have the vehicle refinanced. This could help you get your payments current and might even lower the payments some if they are able to extend the number of months that you have to pay the balance off. Some lenders might not be able to provide you with a very short grace period to get the payments caught up if they are unable to extend a refinancing offer to you.

The other option you have is to file for a Chapter 13 bankruptcy. This isn’t going to do away with the car payment, but it will buy you time to get the payments caught up. When you file for this type of bankruptcy, the court issues an automatic stay that stops the creditor from being able to try to collect the debts and will prevent repossession.

When you file for bankruptcy, you will have to show the court that you have a plan for getting caught up on the secured debts that aren’t going to be discharged during the bankruptcy. You must continue to make the payments on the vehicle for the duration of the bankruptcy. If you miss payments during the case, the lender can repossess the vehicle.