Bankruptcy Forces Creditor to Return Repossessed Car
Having your car repossessed can be a real problem if you’re struggling to make your car payments. One way to avoid this problem is to file a Chapter 13 bankruptcy before you fall behind on your car payments. Resource : https://www.scura.com/blog/bankruptcy-forces-creditor-to-return-repossessed-car
My Car Was Repossessed. Can Chapter 7 Help?
The bankruptcy court may order that the creditor turn over the keys and possession of the vehicle to the debtor. This is important because if the car is not in the debtor’s possession, the creditor is not required to turn it over to the trustee. However, this is only a problem if the creditor is in possession of the vehicle after the bankruptcy filing.
The best way to avoid this problem is to be current when you file. You can do this by making timely Chapter 13 payments. If you fall behind, you can negotiate with the creditor to reduce your payments, which will prevent the car from being repossessed. You can also surrender your car voluntarily. This will prevent the car from being repossessed and will lower your fines.
You can also use a reaffirmation agreement to protect your car. If your car is repossessed after you file for bankruptcy, you may be able to return the car to your lender. This is especially important if you have a current car loan.
In some cases, you can avoid repossession by filing a Chapter 7 bankruptcy. However, you will need to make timely payments during your Chapter 7 bankruptcy case. If your car has been repossessed, you will need to pay the costs of the repossession. This can be several hundred dollars.