You're thinking about filing for Chapter 7 bankruptcy. In order to pay down your debt, some of your property i.e. your car may need to be sold. But you need your car! Is it even possible to keep your car? And if you can, how do you keep it?
You have so many questions and concerns, but relax and take a breather because there is good news-you can keep your car! Chapter 7 gives you two options to keep your car: redemption and reaffirmation.
Reaffirmation
One option you have is "reaffirming" your debt in order to keep your car. In other words, you are taking your car debt out of the bankruptcy process and continuing your duty to pay as if no bankruptcy had been filed.
In order to reaffirm your debt, Chapter 7 requires the execution of a reaffirmation agreement between you and the creditor. Reaffirmation can be advantageous because often your attorney can negotiate with the creditor for more favorable terms than your original loan agreement. However, reaffirmation is not always a viable option because the court can always choose to refuse to sign off on the agreement if it feels that you cannot afford to make the payments under the terms of the agreement.
Consult an attorney in order to determine which option would be best for you. You need the guidance of a legal expert in order to safely and swiftly navigate through the various filing deadlines and other legal nuances of the bankruptcy process.
If you have any questions about bankruptcy, please call 1st California Law Inc at (949) 735-8499 for a free attorney consultation.