Can they repossess my car if I file for bankruptcy?

Once you have filed for bankruptcy, the creditor (the bank who issued the loan) cannot legally have the car repossessed without a court order. As soon as you file for bankruptcy, something called an automatic stay goes into effect right away, making it illegal for your  creditors to contact you or to repossess anything without a court order. If they try to get a court order, you will be notified in advance.  The creditor has to file a motion with the bankruptcy court to “lift” the automatic stay in what is known as a “Section 362 proceeding”. The judge holds a formal hearing and decides whether or not they can take the car. We can try settle the matter in negotiations before court, and discuss with you your options. The bottom line is that you can't keep it if you don't pay for it, but you may not want the car anyway. In that case, we will talk about that too and make arrangements for the car to be surrendered at a mutually convenient time once you have had a chance to take out your stuff. In a Chapter 13, things work a little different.  If your car payments are a problem and you belive that bankruptcy might be right for you, call us for a no obligation no cost consultation with an attorney at 630 250-8813

Carol O'Connor Cadiz
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Attorney & Owner at O'Connor Cadiz Law: Bankruptcy, Injury, Real Estate & Mediation