22 REDEMPTION IN CHAPTER 7 BANKRUPTCY
Chapter 7 is often referred to as a liquidation bankruptcy. This can be a frightening prospect if you have a car and you are not able to make the payments to retain the car and do not want to give it up. However, it may be possible to keep your car through a process known as redemption.
At Susan M. Williams, LLC, we can guide you through the redemption process and answer your questions about Chapter 7 bankruptcy. Attorney Susan M. Williams has more than 30 years of experience representing clients in bankruptcies throughout Connecticut and Massachusetts.
We help clients get debt relief while protecting their assets. Call us today at 860-265-4764 or contact us by e-mail to arrange a free consultation with attorney Susan M. Williams.
Keeping Your Car in Chapter 7 Through Redemption
If you have a car loan and you file for Chapter 7, you have four options. If you are current at the time of the filing of the petition you can retain the car and just continue to make your payments, you can reaffirm your debt, you can surrender the vehicle to your lender, you can reaffirm your debt or you can redeem your vehicle under Section 722 of the Bankruptcy Code.
For many people, surrendering the vehicle or continuing to make car loan payments are not good options. You may need your vehicle to get to work and your car payments may be far above the present value of the vehicle.
In this situation, the law allows you to redeem your vehicle. Through redemption, you can pay the bankruptcy court a lump sum equal to the fair market value (FMV) of your car. You will be able to keep your car.
This can be particularly beneficial if your loan far exceeds the current value of your car. For example, if your loan is $10,000 and your car is worth $5,000, you can obtain an order from the court to pay the creditor the $5,000 and be free of your debt.
Car Redemption Loans in Enfield, Connecticut
When you are in debt, the idea of paying a lump sum for your car may seem impossible. However, you can use exempt assets such as a 401k or obtain financing to cover the lump sum, even while you are in bankruptcy. We can help you find financing and guide you through the redemption process.
To learn more about redemptions and keeping your car in Chapter 7 bankruptcy, call lawyer Susan M. Williams in Enfield, Connecticut, at 860-265-4764 or contact us by e-mail. We offer free consultations for clients in Massachusetts and Connecticut.
Free consultations · Easily accessible from Route 91, off Route 5
We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.