If I File for Bankruptcy, Can I Keep My Car?

Life’s uncertainties can lead to financial burdens and, in some cases, bankruptcy. Amid such turmoil, the thought of losing one’s car – our lifeline to work, school, and essential errands – can be overwhelmingly stressful. At Whitten & Whitten, we understand your concerns and are here to provide professional, empathetic guidance through these challenging times. Depending on your circumstances, filing for bankruptcy may allow you to keep certain assets, including your vehicle, although there are several factors influencing your options. Call our attorneys for a consultation where you can receive specified advice.

Understanding Bankruptcy and Vehicle Ownership

Bankruptcy laws vary by state, and in Indiana, the impact on your vehicle depends on several factors. It is important to remember that filing for bankruptcy does not automatically mean you will lose your car. In fact, bankruptcy can often prevent repossession and help you regain control over your financial situation.

Keeping Your Vehicle In a Chapter 7 Bankruptcy

If you file for Chapter 7 bankruptcy and wish to keep your car, you must meet specific criteria. Your decision will hinge on whether the vehicle is financed or owned outright, whether you are current on payments and if state law allows you to keep all your car equity during bankruptcy.

In Chapter 7 bankruptcy, if you cannot protect your car’s equity or are behind on payments, the trustee may sell your car. You will then receive the exemption amount. However, if you’re not current on the car loan when you file for Chapter 7, the lender can repossess the car either during or after the bankruptcy case.

Chapter 13 Bankruptcy and Your Car

Chapter 13 bankruptcy offers a different approach. This kind of bankruptcy allows you to fix payment issues using a three- to five-year payment plan. If you have nonexempt equity in your car or are behind on payments, Chapter 13 could be a viable solution.

Keeping Your Car in Bankruptcy: Indiana Exemptions

In most cases, as long as your equity in the property is fully exempt, you will not lose your car during your bankruptcy case. Even if your property is not fully exempt, you may be able to keep it if you pay its non-exempt value to creditors in Chapter 13.

Seeking Legal Assistance

Bankruptcy is a complex process with long-term financial implications. It is crucial to navigate this process with an experienced legal team that can provide guidance tailored to your unique situation. Whitten & Whitten is committed to helping our clients understand their options, make informed decisions, and emerge from bankruptcy with their financial future intact. We are prepared to help you find the right path forward.

Protecting Your Vehicle After Filing for Bankruptcy

Filing for bankruptcy does not have to mean losing everything. With the right legal guidance and a clear understanding of Indiana’s bankruptcy laws, it is possible to navigate this challenging process while keeping essential assets like your car. If you are considering bankruptcy, Whitten & Whitten is ready to help you regain control over your financial future.

Remember, bankruptcy is not the end. It is a step towards a more financially responsible life. Call today, and let us guide you through this tough decision, ensuring that your journey through bankruptcy leads to a brighter future.