Friday, October 14, 2016
What Is Repossession And Can It Be Stopped By Filing Bankruptcy?
When debts go unpaid the lender usually takes steps to either collect the money that is due, or to take back the property that was bought with the loan proceeds. If the loan in question is a mortgage loan, a foreclosure case is likely. But with other types of loan where the collateral is not real property, the lender might try to repossess the collateral pledged as security for the loan. The most common type of repossession is auto repossession. If you do not make your car payments it is possible that your auto lender will try to take back your car. This can be a real hardship because without a car you will not be able to go to work and earn the living needed to make not only your car payment, but also to pay your other bills.
If you are in danger of having property repossessed, consider bankruptcy as an option to stop that process. Filing bankruptcy will have this impact on repossession:
• The automatic stay, which is a provision of the bankruptcy law that prohibits a creditor from pursuing collection of a debt or taking back any property the instant a bankruptcy case is filed, protects you from repossession.
• If your car has already been repossessed, you can ask for the return of the vehicle as long as you are willing to provide for the payment of the auto loan debt within the bankruptcy.
Bankruptcy not only stops foreclosures and repossessions, but it also stops any other collection activity that is pending against you. This is one of the biggest benefits to filing bankruptcy, and gives most debtors the chance to take a moment to regroup after their case is filed. Once you have decided to file a case and that case actually gets filed, you can take the steps needed to keep possession of the things you need to live. This includes your home and your car, and knowing those items are safe can really ease the burden you’ve been carrying around with all of your debt.
If you have more questions about bankruptcy, contact us today at www.law-ri.com. We will help you come up with solutions that work for your family, and have multiple locations where we schedule appointments so you can make a choice that is convenient for you.