Tuesday, June 5, 2012

Vehicles and Bankruptcy

If you are seeking to file bankruptcy and are wondering what will happen to your vehicle during the process then below please find a brief review of some of the possibilities. These are some of the most common outcomes; however it is important to have an experienced bankruptcy attorney analyze your case in order to explain exactly what can be done in your particular situation.

At the Miami Bankruptcy offices of Attorney Ariel Sagre, we provide free bankruptcy consultations. Simply call (305) 266-5999 to schedule your appointment with the attorney.

If you are behind on your payments:

If you have fallen behind on your payments and the vehicle has not yet been repossessed, filing an emergency chapter 13 bankruptcy will allow you to stop the repossession and through the chapter 13 plan you will be able to begin making payments again and catch up on the arrearages over a 3 to 5 year period.

If your vehicle has already been repossessed, a bankruptcy filing will allow you to discharge the debt associated with the repossession of the vehicle.

If you are on time with your payments:

If you are on time with your payments and seek to continue to make your payments and keep the vehicle then you may re-affirm the debt through your bankruptcy petition.

If you are on time but do not wish to keep the car, you may surrender the vehicle through the bankruptcy without any consequence.

If your vehicle is paid in full:

If you own your car outright in Florida then your attorney will apply the vehicle exemption of $1,000 and any excess exemption that was not used to protect personal property will be applied as well. Any value above that will become part of the estate that the trustee will administer. Your attorney will assist you in valuing the car as carefully as possible in order to accurately depict to the trustee the true value of the vehicle. Your attorney will then try to negotiate and settle the over exemption.   

If your vehicle loan is upside down:

If you are doing a Chapter 13 Bankruptcy and you owe more on the vehicle than it is worth, the attorney can cram down the value so that you only pay back what the vehicle is actually worth.

Please note* Our office has observed over the last year that vehicle repossessions are at an all-time high. Most lenders have the ability to repossess after only one missed payment. If you have fallen behind on your payments but wish to keep your vehicle, DON’T WAIT. Once the vehicle is taken, there is very little that can be done to recover it.

Attorney, Ariel Sagre is available for consultations by calling (305) 266-5999.