Bankruptcy Attorney For Waco, Texas
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Central Texas:254-304-7161

Can I Keep My Car


A common question asked by people considering bankruptcy is if they’ll get to keep their car. Most of the time, the bankruptcy court won’t repossess a vehicle if it’s clear that the car is necessary to travel back and forth to work and to complete other necessary tasks like medical appointments, grocery shopping, etc. Not all vehicles are automatically protected though. Here’s what you need to know. 

Chapter 13: What Is It?


Contrary to a Chapter 7 bankruptcy, a Chapter 13 does not require the liquidation of non-exempt assets to satisfy all or a part of your debt. Instead, you are placed on a 3 to 5 year payment plan depending on the amount of debt you owe and the disposable income you have available. You are allowed to keep your assets, and once the repayment plan is complete, any remaining debt is typically discharged at that time. 

What May Happen to Your Car in a Chapter 13 Filing


As soon as you file for bankruptcy — either a Chapter 7 or a Chapter 13 — the court puts into place an automatic stay. This is essentially an order for all creditors to halt collections activity against you. They will no longer be able to call you, email you, or send letters during the bankruptcy proceedings. This may allow you a chance to get back on track with your vehicle payments, negating the need for repossession. 

Exceeding Loan Value


In cases where your loan exceeds the value of your car, a Chapter 13 bankruptcy can help you reduce the amount of your loan to the actual value of the car. The excess gets rolled over to non-priority unsecured debt, which is the last debt to be paid by the bankruptcy trustee who presides over your case and makes payments on your behalf. If you exceed the 3 to 5 year repayment plan and non-priority unsecured debt still remains on your account, it is often discharged at this time. 

When to Reach Out to a Bankruptcy Lawyer 

Being overwhelmed with bills and constantly being harassed by creditors is a difficult and stressful way to live. If you’re struggling to meet your financial obligations, a bankruptcy attorney can help. Long gone are the days where bankruptcy was vilified, and today’s bankruptcy solutions can offer you more financial stability and flexibility in repayment than ever before. 

Contact Sims Bankruptcy Law, PLLC today for a consultation at 254-304-7161. 


By : First Page Attorney | January 12, 2020 | Bankruptcy