If you take a loan to buy a vehicle and are unable to pay the monthly payments, your vehicle can be repossessed by the lender. The typical time frame to be concerned is 45-75 days of delinquency.
Do not hesitate to take Help from a bankruptcy attorney and discuss how to prevent your vehicle from being repossessed. You can also recover a vehicle that has been repossessed with the help of your attorney.
How Can You Stop Repossession Of Your Vehicle
Depending on the circumstances, there are some ways by which you can stop the repossession of your vehicle.
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Filing bankruptcy.
When you file for bankruptcy, it gives you protection from vehicle repossession and further debt collections. Depending on the circumstances, you can file for chapter 7 or chapter 13 bankruptcy. Your bankruptcy lawyer will help you understand each and every option’s impact on your car loan. If you want to retain the car, then filing a chapter 13 will be the appropriate option. Chapter 7 bankruptcy provides minimal protection for the vehicle you wish to keep.
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Get current on our payments.
You may not be in default for the terms of your loan until the creditor alerts you in writing. You can make up the payments that you have missed by paying the debt or other late fees.
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Redeem the car.
If your car is already repossessed, you can redeem it until the vehicle is resold. To perform this, you have to pay every money you owe on the car loan. But, it might not be a realistic option. You cannot clear the outstanding debt if you cannot make monthly payments.
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Negotiate with the lender.
You can negotiate with the lender and find a way to eliminate or reduce the debt without repossession. You can also voluntarily surrender the vehicle and try to minimize the future deficiency liability. You can also sell the car to pay the loan.
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Modify the terms of your loan or refinance the loan.
If the monthly installments are higher, you can seek to negotiate the loan modification with the creditor. You can also try finding another lender who will offer you better terms and refinance the loan.
How does bankruptcy stop repossession?
Once you file for bankruptcy, a stay is issued, preventing the lenders from collecting debts. Under the stay, the creditor cannot contact you, sue you, continue a lawsuit, or repossess your car. In stay position, the vehicle is protected from repossession for as long as it is in place.
