One of the common concerns of clients who come to us to discuss their options in bankruptcy is whether they can keep their car. We realize that you need to have a car. A car is needed it to go to work, go about regular daily activities, and more. As always, it’s important to realize that each person has a unique set of circumstances which should be carefully reviewed by a lawyer who can look out for your best legal and financial interests. Contact a bankruptcy attorney fort worth to receive the additional information you need in order to make an informed decision. Good luck and read on for more information about vehicles and bankruptcy.
Because the bankruptcy code is designed to help people and not hurt them, you will find that most of the important and essential assets are exempt and that you can keep them even though you can discharge your debt in chapter 7 or chapter 13 bankruptcies. You’re allowed to keep a car for each licensed driver in the home. That means that if you and a spouse each have a car, whether it’s paid off or has an auto loan, you may keep these cars. Additionally, if you have children in the home or others who are living under your car such as an aging parent, they may also keep a car as well, which would be exempt from bankruptcy liquidation.
In most cases, you’ll be just fine keeping a car payment during a bankruptcy. Oftentimes we’ll recommend that clients get an affordable and reliable car prior to filing bankruptcy. If your car payment is excessive, you may want to give some thought to getting into a more affordable car payment by purchasing a less expensive car. But regardless, as long as you continue to make the payments on the car, you won’t have trouble.
There are some exceptions to this rule, in that continuing to simply make the regular car payments may not be enough. This is the case with auto lenders who require that you reaffirm the debt. Ford Motor credit in Fort Worth division of the north Texas bankruptcy district is an example of this. If you do not reaffirm your auto loan with Ford Motor Credit, they will literally pick your car up the moment your bankruptcy is complete or the automatic stay is no longer in effect. Generally speaking you have 45 days on an executive contract before legal action can be taken to repossess a vehicle.