If exemptions cover all your equity, you can file bankruptcy and keep your car—the trustee and creditors can’t sell it. However, if you have nonexempt vehicle equity, they can take your car in Chapter 7.
Does Chapter 11 wipe out debt?
Chapter 11 and Chapter 13 bankruptcies allow for the discharging of debts but have different costs, eligibility, and time to completion. Chapter 11 can be done by almost any individual or business, with no specific debt-level limits and no required income.
Can you keep a credit card in Chapter 11?
Unfortunately, there’s no way to keep a credit card, no matter the reason. If you owe a balance on the credit card, you have to list it as a debt. The debt will be discharged and the account closed by the creditor. Bankruptcy law requires that you list all of your debts.
Can you keep your financed car in Chapter 7?
If you file for Chapter 7 bankruptcy and local bankruptcy laws allow you to exempt all of the equity you have in your car, you can keep the vehicle—as long as you’re current on your loan payments. And if the market value of a vehicle you own outright is less than the exemption amount, you’re in the clear.
Can I still keep my car if I file bankruptcies? – Related Questions
Can I keep my cell phone in Chapter 7?
In most cases, clients can keep their cell phones without experiencing any service interruptions. However, if you rent or finance your cell phone instead of owning it outright, you may be asked to surrender it.
What is the average interest rate on a car loan after Chapter 7?
Average car loan interest rate after bankruptcy
|
Chapter 7 |
Average Loan Rate |
| New |
| Average credit score at time of filing |
Chapter 7< 560 |
Average Loan Rate New10.58% |
| Average credit score one year after filing |
Chapter 7620 |
Average Loan Rate New6.64%
|
What do you lose when you file Chapter 7?
Chapter 7 bankruptcy erases or “discharges” credit card balances, medical bills, past-due rent payments, payday loans, overdue cellphone and utility bills, car loan balances, and even home mortgages in as little as four months. But not all obligations go away in Chapter 7.
Will I lose my car and house in Chapter 7?
You’re not going to lose your house or car. In a Chapter 7, you’re going to continue making those payments on house or a car. The bank is going to send us what’s called a reaffirmation agreement, and you’re going to sign those and continue to pay.
Can I keep my car if I file Chapter 7 in Georgia?
You can keep your car when you file for Chapter 7 bankruptcy in Georgia. The state allows you to exempt up to $5,000 for your car as long as the equity in your vehicle is less than that amount. You can also protect your car by applying any unused wildcard exemption which covers any property you own.
Can you lease a car while in Chapter 7?
A car lease isn’t the same as a car loan. A lease is a contract to use a car for a period of time. It’s not considered a debt when you file bankruptcy. If you have a car lease and file Chapter 7, you can continue with the lease if your payments are current.
Does your credit score go up after Chapter 7 discharge?
In that case, bankruptcy chapter 7 would, in fact, boost your credit score and results will show within 3-4 months. That’s because, most of the unsecured loans will disappear, keeping a fractional secured loan part to be repaid per month.
What credit score do you need for car lease?
For the best shot of being approved for favorable lease terms, you should have a credit score of at least 700. Some companies may be willing to lease to you with a lower credit score, depending on the cost of vehicle, down payment, and other credit or contract terms.
Can I keep 2 cars in Chapter 7?
In some cases, you can keep two cars when you file for Chapter 7 bankruptcy. But you’ll need to be able to protect all of your vehicle equity using a bankruptcy exemption.
Will Chapter 7 take my tax refund?
Federal Tax Refunds During Bankruptcy
You can receive tax refunds while in bankruptcy. However, refunds may be subject to delay, to turnover requests by the Chapter 7 Trustee, or used to pay down your tax debts.
What is nonexempt vehicle equity?
If you own property free and clear, the equity is equal to its value. Once you know how much equity you have in each item, you can see if it’s covered by the exemptions available in your state. If you own something that’s not covered or fully covered by an exemption, you have non-exempt equity in that item.
Can a married couple keep 2 cars in Chapter 7?
The Bankruptcy Code allows every filer to protect one car with a value of up to $4,450. If a married couple files a joint bankruptcy case, they can protect two cars worth $4,450 each.
How does filing Chapter 7 affect your spouse?
If you’re filing for Chapter 7 bankruptcy and your spouse is not, you may be wondering whether they are going to be affected. The short answer is that if your debts are separate, their credit will not be impacted. Written by Attorney Eva Bacevice.
What is a Phantom discharge?
Debt Incurred During the Marriage
After the bankruptcy is over, community property is off limits to discharged creditors. This “phantom” or “community” discharge protects all community property and lasts as long as both spouses are alive and still married.
What happens if my wife files for bankruptcies?
If most debts are owed only by one spouse, it may be appropriate for that spouse to file for bankruptcy alone. However, if one spouse does file for bankruptcy in order to discharge debts, the other spouse may be held responsible for repayment of some debts, such as jointly-owned credit card debt or medical debt.
Can a lien be placed on my house for a spouse’s debt?
There are also circumstances where you could be legally impacted by your partner’s individual debts as well. If your spouse falls behind or stops making payments on a personal debt, a lender could seek permission to put a lien on your home, or other jointly held assets.