Does this sound familiar? You bought a new car a couple of years ago and made the payments on time, every time. But then your financial situation changed and you’ve fallen behind on your payments. Now, you are facing car repossession from your lender.
This can leave you without a vehicle to get to work, take your kids to school or daycare, and go to the store.
Fortunately, you have options to stop the repossession, including bankruptcy. See how filing Chapter 7 or Chapter 13 bankruptcy can help you avoid vehicle repossession. When you’re facing car repossession, let the experienced and knowledgeable lawyers at The Law Offices of Alexzander C.J. Adams, P.C. help. We will act quickly to protect you and your future.
How To Stop Car Repossession With Chapter 7 Bankruptcy
When you fall behind on your car payments, filing for Chapter 7 bankruptcy can be a solution. This initiates an automatic stay, meaning creditors need to stop making efforts to recover the debt. This includes making harassing phone calls, sending threatening letters, and repossessing your vehicle.
Even with this in place, the lender can still request that the court lift the stay to repossess the vehicle. The lender will need to prove to the court that you defaulted on your loan, or are late on your payments. You can fight back against the repossession by showing the court you made payments, the lender failed to follow the proper steps to inform you your loan was in default, or they made another error. You can also work with the lender to come to a solution and figure out a new payment plan to get caught up on missed payments.
Once the lender knows you are filing bankruptcy, they might reduce the amount of your payments or even the loan balance since the remaining loan amount can be discharged through bankruptcy if the car is repossessed.
Your Chapter 7 bankruptcy attorney can walk you through your options to make sure you are making the right choice for your individual situation.
How To Avoid Car Repossession With Chapter 13 Bankruptcy
Filing for Chapter 13 bankruptcy is another route to avoiding a car repossession. Under Chapter 13, you create a repayment plan with the court to pay back your debt.
Like with Chapter 7 bankruptcy, when you file for Chapter 13 bankruptcy a stay will go into effect, preventing the lender from repossessing your car until the repayment plan is finalized.
If your repayment plan includes back payments and current payments, the lender cannot repossess your vehicle as long as you stay current on the repayment plan.
You also need to stay current on your payments through your bankruptcy proceedings. Failure to do this can result in repossession.
What If Your Car Is Repossessed Before Bankruptcy?
If your car is repossessed right before you file for bankruptcy, you may be able to get the vehicle back in certain circumstances. When filing for Chapter 13 bankruptcy, make sure your repayment plan includes making back payments on missed car payments. Your bankruptcy attorney can help you navigate the steps to take to regain possession of your vehicle. An experienced lawyer will have gone through the process before and helped clients successfully get back their car.
Let Us Help You
When you’re facing car repossession, let our lawyers at The Law Offices of Alexzander C.J. Adams, P.C. help you determine if filing for bankruptcy is the right option for you. We work for you, the people, and not institutions. Contact us for a free case evaluation, or no-obligation consultation. We are dedicated to helping you overcome this small bump in the road and assisting you to get on with your life.