If you’ve fallen behind in your car loan payments you could lose your vehicle. Filing for bankruptcy can help you to avoid that outcome. It might just be the best way to stop repossession and save your car or truck.
At the Law Office of Davis & Jones, P.C., we make the bankruptcy filing process easy. Our legal team is highly skilled. With us you’ll have experienced attorneys guiding you through every step. If you’re in Salt Lake City or the surrounding northern Utah area and you’re worried about car repossession, we invite you to schedule a free consultation.
How Filing for Bankruptcy Stops Repossession
Immediately when you file for bankruptcy, the law imposes an Automatic Stay. This injunction acts as a court order bringing creditor collection attempts to a screeching halt. The Automatic Stay applies to most creditors, including your car loan provider. As such, it works to stop repossession.
What if your car or truck has already been repossessed? If you file for bankruptcy before it’s sold at auction, your attorney may be able to help you get it back. You likely have only a few weeks to take action, however, so if you put off contacting a bankruptcy lawyer, you may not be able to retake ownership of your vehicle.
Keeping Your Car or Truck After Filing for Bankruptcy
The automatic stay in bankruptcy can stop repossession, but only temporarily in Chapter 7. At any point, your car loan provider could file a motion with the Utah Bankruptcy Court, asking for relief from the injunction. If you’re behind in payments or fail to maintain insurance, the judge will probably let your lender reclaim the vehicle.
If you want to save your car or truck, you can try negotiating new loan terms. Or, if you happen to have the funds, you may be able to redeem the vehicle by paying the fair market value in a lump sum. But depending upon your financial situation, filing for Chapter 13 bankruptcy may be a more practical solution.
Keeping your car and protecting your vehicle equity may not always be possible with a Chapter 7 bankruptcy. If you file for Chapter 13, however, your repayment plan can include any missed car loan payments. As long as the court confirms your plan and you comply with the terms of the agreement the bankruptcy filing can permanently stop repossession. And if you happen to owe more than your vehicle is worth, the cramdown option available in Chapter 13 bankruptcy can allow you to reduce the loan balance and interest rate.
Talk to an Experienced Bankruptcy Attorney Today
The team of bankruptcy attorneys at the Law Office of Davis & Jones, P.C., have been helping Utah residents down the road to debt relief since 1995. We offer free consultations, so you have nothing to lose – and potentially, quite a lot to gain – by meeting with us and exploring your bankruptcy filing options.
If you’re in a financial bind and want to stop repossession, save your car or truck and get the debt relief you need, contact the Law Office of Davis & Jones, P.C., in Salt Lake City, Utah, or St. George to discuss filing for bankruptcy today.