The Homework Blog

Credit Card Debt Elimination When Filing Bankruptcy Allows You To Afford Your Vehicle

When you’re in financial distress and facing the possibility of filing bankruptcy, many times repossessions become inevitable. Repossessions of vehicles can be a terrible thing. They can leave you without transportation to work, or even worse shopping at the store and you come out and your car is gone. Technically, when a debtor has defaulted on a car loan, the creditor has a right to repossess your car even if you’re only a few weeks behind on your payments. The creditor doesn’t even need permission from the court to come pick up your car. The reason the creditor can do this, is because the car is a movable asset. Many creditors feel if the debtor is given notice of the repossession they might try and hide the vehicle or damage it. When people are are having difficulties making their car payments, they should keep in touch with their lender. They should keep current on their payments, even if they file bankruptcy and use it for credit card debt elimination they might be more able to afford it with all their other debts wiped out. Also in bankruptcy many times you are given a little more power to negotiate with the lender. They know that if they repossess a car and you are upside down, they will not be able to recover any of the difference by getting a judgment against the debtor. This is one of the benefits when filing chapter 7. The automatic stay will protect you from the lender holding the note to secured property for about 30 to 60 days. This gives you time to figure out what you need to do.