Chandler AZ Bankruptcy Attorneys; Can I Keep My Car?
You will most likely be able to keep you car when you file for bankruptcy. The laws recognize your need for a car, but that car must meet equity requirements.
- In Chapter 7, a single person can have a car with no more than $5,000 equity. If the car has more equity than that, you may have to pay the difference to the bankruptcy trustee.
- For a married couple filing Chapter 7, there can be two separate $5,000 exemptions. You can use them both on one car, to protect $10,000 in equity, or you can use them separately to protect $5,000 on each of two cars. (That does not mean, for example, $8,000 for one car and $2,000 for another. It is two separate $5,000 exemptions.)
- In Chapter 13, if a car’s equity is over $5,000, you can make a plan payment for the overage.
If you owe more than your car is worth, in Chapter 13, you may be able to negotiate a “cram down,” a reduction so that the amount owed is no more than the value of the car. The availability of the cram down depends on whether the vehicle was purchased for personal use or business use, and whether the loan is at least 910 days (about 2 ½ years) old.
Chandler AZ bankruptcy lawyers can explain specific situations and work with the bank to negotiate a cram down.
Learn more about keeping your assets – Talk to a Chandler AZ bankruptcy lawyer at the Rosenstein Law Group.
A car is an essential asset in most families. It is a way to get to work, school, community events, recreation, church, medical appointments. We know keeping your car is important. Contact us for a free consultation with a Chandler AZ bankruptcy attorney.
