You may feel like filing bankruptcy is the only option, but maybe you're also concerned about what that means for your car. People work hard in order to get the money that they need to buy their dream vehicle, and it's very sad when they have to relinquish their title because of a bankruptcy filing. Yet in some cases, if you are behind on your car payments, then bankruptcy might actually help you to keep your automobile, rather than lose it. That's because a bankruptcy can satisfy your debt in the area of car installments. If you file for a Chapter 7 bankruptcy, it can protect your car from a forced sale. When you file, a Chapter 13 may allow you to catch on your car loans in a timely, organized fashion. That way, you won't have to relinquish the vehicle.
Under a Chapter 7, the filer is working hard to get rid of debt and satisfy creditors. If you own your car outright and don't owe any debts on it, then it is probably protected by automatic stay. An automatic stay is a declaration that is placed on the vehicle so that it can't be repossessed. The key is whether or not you own your car title outright, or whether your car is considered a security. If you file bankruptcy and don't own your car outright, you may want to try reaffirming with the car company and pledging to pay your car note. If you reaffirm the car payment, then the debt will not be discharged. You can also redeem your car from a creditor by making a lump sum payment equal to the car's market value. These two tactics may be able to protect you from losing your favorite vehicle when filing. Talk to a Houston bankruptcy attorney today if you need more information!