“I have been told by my lender that my car is up for repossession and they are looking for it right now. I need my car to get to and from work so I can pay for my car! What can I do?” If this sounds like a situation you, or someone you know, is currently facing then perhaps Bankruptcy is the solution.
There is often a plethora of reasons that one would decide to file bankruptcy and stopping a car repossession can be one of them. Upon filing, a Debtor (link to definitions) is protected from their creditors by an “umbrella” which is called the “Automatic Stay.” This “umbrella” forces creditors to stop all attempts to collect a debt, including a repossession. It basically stops creditors in their tracks. This umbrella serves a legal purpose but has the side effect of giving you a much needed “time-out” to regroup and gather your resources.
However, as discussed in the article titled “Can I keep My Car,” you will need to bring your car payments current as soon as possible during your Chapter 7. The reason being that no matter what the only way to guarantee to be able to keep your car long-term is to be current on your monthly car payments. Once you’ve filed bankruptcy you will need to get yourself current as soon as possible. If you end up filing a Chapter 13 you will be put in a payment plan that helps you get caught up.
The reason you must eventually get your car loan current is that your loan is “attached” or “secured” to your car. This is why lenders are allowed to repossess the car if you are not paying on the loan. The Bankruptcy can temporarily stop a repossession but it is up to you to get your loan up to date if you wish to keep the car long-term.
If you are facing a repossession Contact RS Law today for your free consultation. Get ahead of this repossession as soon as possible.