Car loan in Chapter 7 or Chapter 13 bankruptcy?
Aug 29, 2011
in
Chapter 13
I got into a car accident, it was a total loss, and the place where I got it from didn’t offer gap insurance. My insurance company paid about 00, and I owe about 00 on it. I haven’t been able to pay since March 2011. I am possibly eligible for Chapter 7 with all of the other debt that I have. I am unfortunately seeking bankruptcy. Can I claim this loan in bankruptcy? What will happen to it if not? I’m making my first payment very soon either way. I bought a car with cash, but it is old, 14 years old.
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3 comments
wanttoknow25 on August 29, 2011 at 11:12 am
so you owed 3900 more than it was worth or you only have 500.00 left to pay?
Let me steer you on August 29, 2011 at 11:12 am
Yes, you can list any indebtedness on your bankruptcy except student loans, child support and past due federal income taxes. If you do not list the balance owed on the car loan, you will still have to pay it after the bankruptcy is discharged, which would be a very stupid idea.
You need to consult a bankruptcy attorney. The first consultation is free, and bankruptcy is something you should not try to do alone unless you have been through it before. Even then, I wouldn’t try it without an attorney. The attorney will guide you on how to get the best deal out of the bankruptcy. DO NOT make any payments on the loan if you are really going to declare bankruptcy.
wg0z on August 29, 2011 at 11:12 am
being upside down 500 on a car loan is probably not, in and of itself, a reason to file BK. the fees alone would bemore than that. but if you have other insurmountable debts, yes you can include the $500 car "gap" debt as part of the BK. your current heap must perhaps be listed as an asset as part of the filing but is probably untouchable – that is, you wont be forced to sell it or trade down. it is understood that you need a vehicle to go earn and the car really isnt worth anything; at a dealer auction, it wont fetch anything.