Murfreesboro Chapter 7 Bankruptcy Lawyer
Unless you live in a densely populated urban area with a good public transportation system, it's difficult to live without a car.
At The Law Offices of James Flexer, our bankruptcy attorney in Nashville use their experience and knowledge of the U.S. Bankruptcy Code to help people in Middle Tennessee keep their cars and trucks, while gaining the debt relief they need to regain control of their finances. Contact us today to set up a free consultation with an experienced bankruptcy attorney in Nashville. We also have offices in Murfreesboro and Columbia.
Bankruptcy and Car Loans
The bankruptcy attorney in Nashville process can erase many types of debts: medical bills, unsecured credit card debts, old tax debts and more. One of the things it can't do is wipe away an auto loan (at least not if you want to keep the car that loan was used to purchase).
So what are the options in a Chapter 7?
- You can give back a car as payment in full on the loan, even if the car is worth less than what you owe.
- You can reaffirm the loan and continue to pay your regular monthly payments, provided you can get your lender to agree to "reaffirm" the loan (which allows you to keep paying for the car at the original contract terms). Although it's the lender's choice to reaffirm or not to reaffirm, most will agree to this option.
- You can do what bankruptcy lawyers call a redemption. Basically, this option forces the lender to accept a lump sum payment equal to the car's book value instead of what you actually owe. Creditors do have the right to contest this.
- You can voluntarily work out an agreement with the creditor where you keep paying for the car, and the creditor lets you keep it without signing any agreement.
Chapter 13 bankruptcy provides additional options for keeping your car:
- You can include missing car loan payments in a Chapter 13 reorganization plan and repay them over time.
- You can get the terms and interest rate on your loan modified to make payments more affordable.
- You can do a "cram down" and significantly reduce the amount of money you owe on the car. This is basically a type of redemption in which your loan debt gets reduced to the book value of the car. The difference is that you do not have to come up with the lump sum payment. This option can be used only if the auto loan agreement was signed more than 910 days before you filed for bankruptcy.
Has your car been repossessed? If your lender hasn't sold the car yet, we may be able to get it back. Don't hesitate to contact us and learn more about your options in a free initial consultation.
