QUESTION
Can the bank take my car if I file for bankruptcy?
Asked on Mar 23rd, 2013 on Bankruptcy - New York
More details to this question:
I owe about $70,000 in credit card debt. I would like to go bankrupt, I have a question. I have a 2007 Toyota Camry worth around $12k. Would I lose my car if I file for chapter 7 bankruptcy? I have no house, I live in an apartment, and I don't have any other property and my car is my only possession. Can they take away my car??
14 ANSWERS
The answer to your question depends on when and where you file bankruptcy. The property you can keep depends on the exemptions available to you at the time you file bankruptcy. The car may be fully exempt, partially exempt or completely non-exempt under applicable law. You should consult a bankruptcy lawyer in your area for guidance.
Answered on Apr 03rd, 2013 at 8:55 PM
Commercial Bankruptcy Attorney serving Davie, FL
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Law Office of Jeffrey Solomon
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If you are a Florida resident who can use Florida exemptions, you can retain $1,000 in personal property, $1,000 in value in a car, and an additional $4,000 in personal property that you can apply against the car. As a result, the chapter 7 trustee would have a claim on your car based on your numbers. The trustee could take and sell the car. As a result, you need to confer with a bankruptcy attorney about your options including a possible chapter 13 payment plan.
Answered on Mar 25th, 2013 at 4:06 PM
Bankruptcy Attorney serving Phoenix, AZ
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Law Office of D. L. Drain, P.A.
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It depends on the exemptions of the state where you live. Please understand that filing for bankruptcy is a very complicated process. It is wise to talk to an experienced bankruptcy attorney before deciding to take this important step.
Answered on Mar 25th, 2013 at 4:06 PM
Estate Planning Attorney serving Wilmington, DE
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Reger Rizzo & Darnall, LLP
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You have a personal exemption that you can use to exempt the car.
Answered on Mar 25th, 2013 at 4:05 PM
Bankruptcy Attorney serving Walnut Creek, CA
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Alan E. Ramos Law Offices
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You don't indicate if you have a loan on your vehicle. If you do and you are current on the payments (and you can exempt the equity) you should have no problems. If you are not current on your loan, you will need to find a way to bring the loan current (or file Chapter 13). If you have no loan on the vehicle, and you can exempt the value of the vehicle, you should have no problem keeping it.
Answered on Mar 25th, 2013 at 4:05 PM
Bankruptcy Law Attorney serving Livingston, NJ
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Law Office of Stuart M. Nachbar, P.C.
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That depends on what state you live in.In New Jersey we use the federal exemptions, and one of them is for a vehicle. That plus the federal exemption wildcard should exempt out the car.
Answered on Mar 25th, 2013 at 4:05 PM
Bankruptcy Attorney serving Overland Park, KS
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The Smalley Law Firm, LLC
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No. You are entitled to keep one car per person in bankruptcy. However, if you are making car payments you will need to continue to make them.
Answered on Mar 25th, 2013 at 4:04 PM
You can exempt your car in bankruptcy. You will ask your car debt to be reaffirmed and as long as you keep paying your car payment you will be fine.
Answered on Mar 25th, 2013 at 4:04 PM
Bankruptcy Attorney serving Charleston, SC
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Davis Law Firm
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Your question is a very common question and there is not a perfectly clear answer. If you are correct as to the value of the vehicle, it is unlikely you would lose the car. You have what are called exemptions and they may be sufficient to make it so that the credit card lenders will not bother the car. I am understanding that you actually have the title to your car and that no liens are on the title to the car. You should contact a bankruptcy attorney who can advise you as to the likelihood of losing the vehicle for the credit card debt. Exemptions are important and how long you have lived in South Carolina will affect what exemptions you can claim. Meeting with an experienced bankruptcy attorney may help you determine if this is the proper time to file for bankruptcy. Credit card lenders seldom try to take any property so you may be better off trying to fix what appears to be an income problem.
Answered on Mar 25th, 2013 at 3:09 PM
Bankruptcy Attorney serving Overland Park, KS
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Wellman Law LLC
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Whether your car would be liquidated in the Bankruptcy depends on the exemptions that would apply. When Kansas exemptions apply a vehicle worth up to $20,000 can be protected. Other states, such as Missouri at $3,000, have much less protection. If you've moved states within the last 2 years you'll probably want an attorney to assess what exemptions apply. Even in the situation where there is unprotected equity there are some reasonable options such as paying the equity yourself over approximately 6-12 months or paying the equity in a Chapter 13 plan over the course of 3-5 years. Finally, although you didn't mention whether the vehicle is still being paid on or otherwise has lien, it would have to be paid off even if filing Bankruptcy or the car could be taken.
Answered on Mar 25th, 2013 at 3:08 PM
Deborah F. Bowinski
The laws that determine what assets you can own and protect from you creditors when filing a bankruptcy case vary significantly from state to state. You should consult with an experienced bankruptcy attorney in your jurisdiction to determine whether bankruptcy is the right solution for you and to try to protect as much of your limited resources as possible. Retaining competent counsel will be well worth the costs.
Answered on Mar 25th, 2013 at 3:08 PM
Bankruptcy & Debt Attorney serving Syracuse, NY
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Theodore Lyons Araujo
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We have to know the entire "asset" picture to answer the question, but generally and almost always the car is not affected by the bankruptcy and you get to keep it. People often ask if they can keep homes, second homes, cars, boats, tax refunds, etc., when they are contemplating Bankruptcy. I always tell them they can keep what they want of they can pay for it, or if the equity or value is protected by an exemption in their State! There are two types of Bankruptcy for most individuals. Chapter 7 (liquidation) and Chapter 13 (payments are made to a Chapter 13 Trustee to be distributed pursuant to a Plan you and your attorney draft). To determine of you get to keep the property you have to know two things. 1) What is the equity in the property? (I.e., what is it worth minus what you owe on it). 2) Will the exemption laws that are applied to the property protect the equity? Bankruptcy is much more concerned with equity than it is with debt. If you have no equity in a rental home the Trustee in a 7 or 13 does not have an interest in the property and you may keep it. If you owe more on the vacation home than it is worth you may be able to use Bankruptcy to reduce the amount of the debt, and again, keep it. When you have equity in something that is not protected by an exemption then that is an issue that a lawyer must evaluate. See an attorney right away before you act.
Answered on Mar 25th, 2013 at 3:07 PM
Bankruptcy Attorney serving Grand Rapids, MI
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David Andersen & Associates, PC
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No. If you own a car free and clear then you would likely be able to exempt the car and keep it in a Chapter 7 proceeding. You are provided exemptions in a bankruptcy that allow you to keep so much "stuff."
Answered on Mar 25th, 2013 at 3:06 PM
If you accurately describe your assets it seems that you will be able to use the federal exemptions when you file your bankruptcy, meaning that you will be able to claim a $3,450.00 vehicle exemption and an $11,975.00 wildcard exemption, which you will apply to the excess equity in the vehicle. It appears that your car will be fully exempt, meaning that you will not lose your car.
Answered on Mar 25th, 2013 at 3:06 PM