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In many people's lives, the single most important asset is the car. When debt begins to spiral out of control and bankruptcy becomes an option, many individuals worry about losing their vehicle during the process. It is crucial that you consult with an experienced bankruptcy lawyer so you have a clear understanding about your situation and options.
At Ledford & Wu, our Chicago, Illinois, bankruptcy attorneys focus the attention and resources of the firm on helping individuals find a way out of their difficulties. In today's challenging economy, many individuals quickly find themselves facing mounting debt. Bankruptcy is a powerful tool that individuals can use to eliminate certain forms of debt and start toward a stable financial future.
Car loans are typically handled in different fashions whether a client is seeking Chapter 7 or Chapter 13:
- Chapter 7: In Chapter 7 bankruptcy, individuals have three options to consider. 1. Maintain the payments and keep the car by signing a reaffirmation agreement with the lender. 2. Surrender the vehicle back to the lender and eliminate the debt. 3. An individual might be able to set up a redemption of the vehicle by paying off what the vehicle is worth and eliminating the rest of the debt. Usually, that means getting a lender to finance a new loan. Your bankruptcy lawyer can help with that.
- Chapter 13: In a Chapter 13, even if you are behind in your payments, we can protect the car and give you an opportunity to pay off the debt. We can almost always reduce the interest rate on the vehicle and often reduce the total amount owed. Many factors depend on the original vehicle financing.
As with home loans, it is important to seek the counsel of an experienced bankruptcy attorney. There are many rules and a great deal of paperwork that must be filled out accurately and submitted on time. We can help ensure that you do not miss any deadlines and can take advantage of the options available to you.
Contact Any of Our Area Offices
Learn more about how to handle car loans. Call 888-542-1900 or contact our offices by e-mail to discuss your options during a free consultation with an attorney.
We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.
