If you are hiding your vehicle to keep the “repo man” from taking it back, you’re most likely going to lose your car sooner rather than later. There is a better way to stop your car from being repossessed and to stop other creditor harassment. While filing bankruptcy is a drastic step, it may be your only choice if you have too many creditors.
Options: If your only issue is a vehicle loan, you may be able to arrange a settlement with the creditor. However, if you lost a job, took a pay cut or are unable to work because of an illness, you may be having problems paying the mortgage, credit cards, utilities and your car payments. If you are behind in other payments, you may want to consider bankruptcy to take care of the rest of the liabilities, too.
Bankruptcy Options: Once you decide to file bankruptcy, as a consumer, you have three choices:
- Chapter 13: Chapter 13 reorganization means you pay back some of your debt during the bankruptcy. Your New York City bankruptcy attorney will help you draft a three- or five-year plan.
- Chapter 7: Chapter 7 liquidation means that you turn over your non-exempt assets to the bankruptcy court. The court will then sell your assets and use the money to pay off as much of your debt as possible.
- Chapter 11: Chapter 11 is also a reorganization bankruptcy. This is generally reserved for businesses, but individuals who have many properties or several high-value assets may opt for Chapter 11.
A New York City bankruptcy attorney will help determine which form of bankruptcy is best for your situation. Furthermore, you must be able to qualify to file a Chapter 7 bankruptcy.
How Does Bankruptcy Stop Creditors? Regardless of which type of bankruptcy you file, an automatic stay goes in place as soon as your New York City bankruptcy attorney uploads the petition and receives a case number. The bankruptcy court notifies all creditors that you list that you have filed bankruptcy, so be sure to list all of your creditors. If you continue getting calls from creditors, advise them to call your attorney. If you forgot to list a creditor and that creditor calls you, advise the creditor that you have filed bankruptcy; and that the representative should contact your attorney.
Can the Bank Still Take My Car? No, because the automatic stay is in place. Your creditor must cease collections and notify the repossession company to stop trying to repossess your car.
Do I Need to Make Payments on My Car During Bankruptcy? In most cases, you must make regular monthly payments on your vehicle. If you are behind in payments, the arrearages are figured into the plan for Chapters 11 and 13.
Can I Make Payment Plans with Creditors During Bankruptcy? If you want to keep your car, your New York City bankruptcy attorney can help you work with your creditors. You have several options, depending on your income. You may be able to make additional payments, or your attorney may be able to come to a settlement with the creditor, agreeing that you will tack all missed payments onto the end of the loan.
Once My Car Has Been Repossessed, Can I Get it Back? In some cases, you may be able to get your car back. As long as the creditor has not auctioned the car; and you file bankruptcy within the allotted time, there is a possibility that you may able to get your car back. If you need your car to get back and forth to work; and you have no other options, you may have to file bankruptcy. Contact an experienced New York City bankruptcy and repossession attorney to discuss your options.
Purchasing a Car After Bankruptcy: Many people think it’s difficult to get credit to purchase a new car after bankruptcy. In fact, it is usually easier to get the credit once your bankruptcy has been discharged. You’ll notice that you get credit offers in the mail once your bankruptcy has been discharged. This is because you now have a clean slate — it’s almost like having no credit. Creditors know that you do not have any other liabilities and want to be the first to get your business.
Contact an experienced bankruptcy attorney today to discuss your finances and options to get your life back on track. We can help you with settlement negotiations or bankruptcy if you need to save your car, home and other possessions from being taken by creditors.