Does Filing For Bankruptcy Hurt My Chance For Car And Truck Loans?

Keeping the car or truck you use to get to work may make the difference between keeping your job or losing it. Preventing repossession is vital to your financial health, and the bankruptcy laws can make this possible.

Preventing Repossessions And Recovering A Repossessed Vehicle

Your lender is prohibited from repossessing your car or truck when you first file bankruptcy. We immediately and aggressively take action to notify your lender by phone when you are on the verge of having your transportation repossessed.

If your car or truck has already been repossessed, the Bankruptcy Court will usually order it returned to you. Often we can work out an immediate return from the majority of prime lenders without having to wait for a court order; otherwise we will file an adversary proceeding immediately. Our Bankruptcy Court sets these on a priority basis and usually hears them within three to four weeks. It is important to act immediately because you must file and notify the lender before it is resold.

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Making Your Car Or Truck Affordable Cram-Down

Chapter 13 allows you to save your car or truck, and can reduce your monthly car payment and lower the interest rate you are paying. The amount you repay can be reduced substantially. Our office can help you investigate how to make your car or truck affordable and if a "cram-down" can help you.

A cram-down allows you to pay the amount that the car is worth (but never more than owed) as secured. The difference between its value and the amount owed is treated as unsecured, which is paid without interest and often paid as little as ten cents on the dollar.

Furthermore, interest rates are usually lowered and the loan payments are stretched out for a period of time, up to 60 months.

Title Loans And Title Pledges

Many small and payday lenders require you to pledge your car or truck, putting it in jeopardy. The bankruptcy laws afford you the same relief and protections as against traditional lenders. The automatic stay stops sales and repossessions when you first file and a cram-down can make keeping your transportation affordable.

Keeping Your Car Or Truck In Chapter 7 Bankruptcy Reaffirmation

Chapter 7 is often is a better option than Chapter 13 when you are burdened with a lot of medical debts, credit card debts, and payday loans that make it difficult for you to keep your car or truck note current. Because transportation is a necessity for most people, you may want to reaffirm the debt on your car or truck and continue paying the note. Obtaining a reaffirmation agreement is routine if you are current on your payments. We will contact your lender to negotiate an agreement so you may keep your car or truck, but keep in mind that you are not required to reaffirm any debts.

Keeping Your Car Or Truck In Chapter 7 Bankruptcy Redemption

Another way to keep your car or truck when you file Chapter 7 bankruptcy is to redeem it from your lender. The Bankruptcy Court orders your lender to release its lien if you pay an amount the court orders in a lump sum. This amount is usually the amount your car or truck is worth, and may be a better option than paying the existing debt when you owe substantially more than what it is worth. We consider every possibility to help and will advise you about the ins and outs of this process.

You may ask, "How will I be able to pay this amount all at once?" We can put you in touch with lenders that can finance the redemption amount. Tax refunds or family assistance are other sources that may help you pay the redemption amount.

Contact Us Today

Call now to learn about what options are available to you in your particular financial situation. Contact our law firm today online or call 901-201-6012 to schedule a FREE CONFIDENTIAL CONSULTATION.

Unlike many firms, you will always discuss your financial situation with an attorney, not a paralegal or assistant.

We are a Title 11 debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code. This ad does not create an attorney-client relationship until a written agreement is signed.