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As long as you intend to pay for the car. Same with a house. You can keep the house. Different chapters of Bankruptcy. Depends on what you are trying to do. When you file, you keep the car out of the BK.
Then again it does not help if you have not been making the payments.
Before someone decided to file for a BK I would ask them, have they done all they can to pay back the debt that they owe? Are you working all the overtime you can work? Are you working a second job? Do you have a side hustle that can bring in extra money. Do you have things you could sell to raise money? Have you cut the cable, Starbucks, other extras out of your life. Have you stopped spending money on things you don't need. People are surprised at all the money they can find when they cut back.
When one files for bankruptcy, ALL accounts must be listed, even if you intend on keeping up payments.
It is up to the judge as to approving a reaffirmation agreement between creditor, and borrower, but again, ALL debts must be listed on the application for bankruptcy.
If a item is not listed (vehicle) and the court later finds that a vehicle loan(though up to date)was not part of the filing, the bankruptcy case will be thrown out of the court.
One of my associates had to file not long ago, and this is what his attorney told him about listing every debt.
Does bankruptcy allow you to keep a car that you owe money on?
It also depends upon the type of bankruptcy. For Chapter 7 (which I assume that the OP would pursue, given that he has used a second-tier lender and can't pay them), all debts are instantly forgiven. It could be more difficult to keep a significant asset in that scenario. From a bankruptcy law site:
"You don’t have to give up all of your property when you file for Chapter 7 bankruptcy. If you own a car, you’ll likely be able to protect (exempt) a particular amount of the vehicle’s equity (each state’s law varies). If the equity value is worth more than you can protect, the bankruptcy trustee assigned to your case will likely sell it and distribute the nonexempt proceeds to your creditors."
In Chapter 13, in which you make monthly payments to the court in exchange for debts being forgiven for a reduced amount, if the loan is current you can exempt the vehicle from the filing and make the payments as usual.
Most banks and credit unions will let you make interest only payments for a few months here and there occasionally, if you get into a tough spot, just have to talk to them about it, they are usually pretty willing to work with you, as long as you are giving them something and keeping in contact.
I can’t figure out why anyone would want to get a broken down car back. It would be one thing if you missed a payment because you had to pay for repairs.
Is the car garaged? Are you almost 3 months behind?
I kept a car from being reposesed once; a very odd situation when I was single-momming it, working my butt off, broke up with the kids dad & suddenly got knocked down in the dirt by PTSD from my daughters death a couple of years before.
The collection agency was calling me so much I actually developed a rapport with the agent; a girl about my same age who had just ended a relationship with a POS ex, just like I had. There was this tow truck guy following me around ... It was a game of cat & mouse. He called me once; “Why are you making my job so hard?”(sigh)
I had already paid 3/4 of the note off but I just could not catch up. One night my ex broke into my house & it ended poorly; with me admitted to the hospital with a head injury. I called the collection agency crying & my agent friend told me not to worry; she could stall.
When I was back to work about a month later, I called to try to fix things, although it hadn’t occurred to me that I hadn’t seen the tow truck guy lurking around. The agent was not with the company anymore ... & neither was any record of my car note. I had the police department run the vin; no liens nor holds. Very odd.
I can’t figure out why anyone would want to get a broken down car back. It would be one thing if you missed a payment because you had to pay for repairs.
Is the car garaged? Are you almost 3 months behind?
I kept a car from being reposesed once; a very odd situation when I was single-momming it, working my butt off, broke up with the kids dad & suddenly got knocked down in the dirt by PTSD from my daughters death a couple of years before.
The collection agency was calling me so much I actually developed a rapport with the agent; a girl about my same age who had just ended a relationship with a POS ex, just like I had. There was this tow truck guy following me around ... It was a game of cat & mouse. He called me once; “Why are you making my job so hard?”(sigh)
I had already paid 3/4 of the note off but I just could not catch up. One night my ex broke into my house & it ended poorly; with me admitted to the hospital with a head injury. I called the collection agency crying & my agent friend told me not to worry; she could stall.
When I was back to work about a month later, I called to try to fix things, although it hadn’t occurred to me that I hadn’t seen the tow truck guy lurking around. The agent was not with the company anymore ... & neither was any record of my car note. I had the police department run the vin; no liens nor holds. Very odd.
Ive heard of people that have avoided repossession for SO long that eventually the bank files a criminal report to get the car back, this is the last step if a person stores the car on private property or tow trucks cannot get to the car.
One local guy stored a truck on someones farm, and kept in a barn, out on the acreage, while he drove something else, the repossession agents could not find it of course, and after so long, they filed criminal theft charges to force him to give it back or face jail time.
Work out a negotiated payoff amount with Santander. A dealer will pay off the car if it is worth more than the payoff amount, then will purchase the car. The car must be worth significantly more than the payoff amount. Santander will drop their payoff amount significantly just to get some money out of it.
If the car doesnt run, or needs alot of work, it sometimes is not in the best interest of the bank to repossess, this happens more often than people think too.
My exwife had this happen to her with a Dodge truck she bought. it had major engine trouble a few months after she bought it, she had only made 3 payments, and they wouldnt allow her to make the 4th, they tried to claim they didnt know who she was, they knew nothing about this truck/loan! Even after she went to the DMV, their name was on the lien, they still claimed they didnt have it, they said the DMV data was wrong. This was actually a big hassle for my exwife, eventually the county released the lien due to time limitations, but ultimately 'someone' was out that money.
I'll respect the premise of why bankruptcy would not require your silly questions or antedotes. What good is living if your working 12 hr ,7 days and selling off your house goods to keep that image ? Of being in debt.
I was encouraged to avoid bankruptcy despite being 27 k in debt. Because I had pride and didn't want to be a debt dodger. So 4 yrs later the debts were paid ..and I now have 12 years of bad credit listed !! Never mind that I paid every dime. Had I filed bankruptcy I would have only 1 bad mark. And then it would be 27 k in my account . I no longer listen to fools who have no clue how bankrutcy works and why sometimes it's necessary.
$27,000 is not much debt at all. In addition bad debt does not stay on your record forever. Someone with only $27,000 in debt can make arrangements with the debtors to arrange payment. If you were in fact paying that money back you would have good credit in a few years. If you were paying it back, you would not have 12 years of bad credit.
As for how bankruptcy works, I know exactly how it works. I have filed before. I also looked at how not to ever have to file again.
Working all the time to get out of debt is not a long term thing. It is a fix to get out of the problem that a life style of getting into debt created. Not something that someone has to do forever.
Also it does not keep someone from filing. The first step to getting out of debt is to see what you can do about the debt. BK is a last resort.
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