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Repossession happens when an item that has been sold on credit has been taken back from the purchaser because the payments have not been made on it.
This is a problem many Coloradans face due to struggles with overwhelming debt. Medical bills, unemployment, divorce, or a sudden emergency can happen at any time, to anyone. And with many residents already living paycheck to paycheck, any sudden, extra financial burden can be catastrophic.
On this webpage, our experienced Denver bankruptcy attorneys focus on how bankruptcy can halt the repossession process. Throughout this page, we will focus mostly on the repossession of cars, trucks, or motorcycles- as vehicles are the most common types of property that get repossessed throughout the state.
However, this does not mean that vehicles are the only type of property in danger of being repossessed. You can find more information about what assets can and cannot be repossessed on our other page that focuses on repossessions.
After you have had a chance to read through our brief overview of how bankruptcy can halt repossession, we encourage you to contact one of our Denver repossession attorneys for a no-cost case evaluation.
If you have recently had a vehicle or possession repossessed in Denver, it may not be too late to get your property back! Time is of the essence though, so don’t delay- reach out today for help.
If you’re reading this because your car has been repossessed– don’t panic! You have options. The first thing you should know is that you need to act quickly– you only have about 20 days to decide whether you’re going to try and get your car back because a car lender must only keep a car for 20 days after repossession.
If you want to stop repossession, your options are as follows-
1. Pay missed payments to the lender
Once your car is repossessed, the lender can demand that you pay the entire loan off before giving you the car back. Realistically, this seldom happens. What will most likely happen is that the lender will let you pay the arrears and repo charges to get the car back. If you have not had multiple repossessions, you can usually just call the lender, arrange to pay the arrears and get your car back.
2. Pay the entire loan off
Obviously, if you’re already deep in debt, this is the least desirable option. If you have the money, you can obviously just pay the entire loan off, get the car’s title, and wipe your hands of the lender forever. However, our experienced CO bankruptcy attorneys understand that not everyone has the luxury of having this much money on hand, especially on short notice.
3. File Chapter 13 Bankruptcy
Chapter 13 bankruptcy is the only way to force a lender to give back a repossessed car immediately without paying them any money. If the amount the lender wants to give back your car is too high, filing Chapter 13 bankruptcy forces them to give the car back and take payments over time.
There is an additional benefit of filing Chapter 13 bankruptcy in Denver– if you qualify. Some car loans can be “crammed down,” in Chapter 13. This involves paying off the car at a reduced or “crammed down” amount based on the value of the car through bankruptcy court. Be aware that this “cramdown” right only applies to cars purchased more than 900 days before filing for bankruptcy.
4. Let the car go
Unfortunately, sometimes it makes more sense to just let the car go. It’s worth noting that if you decide to take this option, you will often still be liable for a deficiency. If you have trouble paying a deficiency, you may be able to defeat it if the repossession process was faulty in some way or by discharging it (and other debts) in a Chapter 7 bankruptcy.
To discuss these four options in more depth, please contact one of our Denver County bankruptcy attorneys. We offer a no-cost, no-obligation case consultation to prospective clients.
If your lender is threatening to repossess your vehicle, filing for bankruptcy can help you protect your property. But not all bankruptcies are the same. How you can protect your possessions from repossession will depend on what type of bankruptcy you are filing.
Debt relief seekers in Denver commonly file for either Chapter 7 or Chapter 13 bankruptcy. Regardless of which you chose, as soon as you file for bankruptcy in Denver an automatic stay goes into effect. The automatic stay halts all creditors or collection agencies from trying to collect money or assets from you during the duration of your bankruptcy case.
Chapter 7 bankruptcy, also known as simple bankruptcy or liquidation bankruptcy, is a form of bankruptcy in which the debtor’s debts are completely discharged via the liquidation of the debtor’s assets. All profits from the sale of the liquidated items are then used to pay off the petitioner’s debt. Any leftover debt not covered by the liquidation is then discharged.
Don’t let the words “liquidated assets” scare you off from filing for Chapter 7 bankruptcy. If you’re looking to keep certain assets, such as your primary vehicle or tools you require to do your job, Denver offers extremely generous asset exemptions for petitioners of Chapter 7 bankruptcy. That means that you may be able to keep your car from being repossessed when filing Chapter 7.
Of course, there are exceptions to this, and our experienced Denver bankruptcy attorneys would be happy to go over exemptions with you during your initial case consultation.
As we explained in the previous section of this website, Chapter 13 bankruptcy is generally one of the “easiest” ways to get your car back if it’s been repossessed.
The chapter 13 bankruptcy plan, also known as a wage-earners bankruptcy, provides for payment or partial payment of secured and unsecured debts via a payment plan spread out over the course of 3 to 5 years. By filing your Chapter 13 case, your secured loan creditor will be forced to receive their payments through the Chapter 13 plan. This means that your past-due car payments will get lumped into your payment plan, allowing you to get caught up.
Could there be anything more unnerving than looking out of your window one morning to find your vehicle missing? Perhaps discovering that your boat has been repossessed? But seriously, chances are that if you are behind on your car or truck payments, you saw a repossession coming. But just because you knew something could happen in the back of your mind doesn’t mean you were prepared for it to actually happen.
So, what do you do now?
Take a few deep breaths and try not to panic. You have options, and if mounting debt is the cause of your car or other property being repossessed, bankruptcy may be the best choice for you. The fastest way to determine your debt relief options is to contact an experienced Denver bankruptcy attorney.
During your free case consultation, our team of legal professionals will listen to the details of your case and go over every option available to you. Our experienced attorneys are well-versed in Colorado car repossession laws, bankruptcy, and can help you explore all debt relief avenues.
You can stop repossessions. Our legal team is ready and willing to help you today, so take advantage of our free consultation offer without delay.