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While Colorado Springs does have a public transportation system in the form of Mountain Metropolitan Transit, the best way to get around Colorado Springs is a car. This is especially true for residents looking to get out and explore Pikes Peak or the Garden of the Gods.
El Paso County residents use their cars not just to explore the natural wonders of the county, but also to get to work, school, doctor’s appointments, or home to spend time with family.
The loss of a vehicle due to repossession would be not just a hardship, but potentially catastrophic if that vehicle is used as a means to get to work. Consider also, the time lost having to use public transportation to get to all of those places that could’ve been better spent earning money to pay down debt.
At a time when you are facing significant hardship because of financial difficulties, you don’t need to add to your worries by losing your car. Filing for bankruptcy with the help of our experienced Colorado Springs bankruptcy attorneys is one way to move toward stopping car repossession.
When you finance your vehicle in El Paso County, your creditor has the right to timely payments. If you miss payments, the creditor has the right to repossess, or take back, your vehicle.
Most lenders generally allow you to miss one loan payment before being threatened with vehicle repossession. Under Colorado law, you must be in default on your loan agreement for at least 10 days before your lender can send you a default notice. After your lender sends a notice of default, you have an additional 20 days to bring your loan current before your lender can repossess your car.
The first formal step in the repossession process is the Notice of the Right to Cure. This Notice informs you that you are behind on payments and tells you the specific amount that you need to pay to get caught up, and the due date for that payment. You then have 20 days to catch up on payments.
Under Colorado law, borrowers are only entitled to one right to cure notice every 12 months. That means that if you’ve already received one Right to Cure Notice in the past 12 months (and have already cured that default) if you default on any more payments in the next year, your lender no longer has to send you another notice and repossess your vehicle without further notice or warning.
Additionally, what counts as a default depends on your contract terms. It’s important to note that defaulting on your loan doesn’t always mean that you’re behind on payments. For example, certain contracts may stipulate that if your insurance lapses, you have defaulted on the terms of your loan and your car may be repossessed, even though you are current on car payments.
Lastly, you should know that in Colorado Springs it is perfectly legal for a repo man to come onto your private property to repossess your vehicle. While many states have regulations on where and when your vehicle can be repossessed, in El Paso County as long as the person repossessing the car doesn’t breach the peace, they may take the vehicle on public property or private property.
One of the most prevalent myths attached to filing for bankruptcy in Colorado Springs is that you will automatically lose your car or home if you choose to file. That is not the case. Protecting your vehicle from repossession is difficult when you are experiencing a financial crisis that makes paying your car payments difficult. That is why personal bankruptcy exists, to help people “start over” and get back on their feet, financially.
The two most commonly filed personal bankruptcy chapters in Colorado are Chapter 7 and Chapter 13. Immediately after you have filed for bankruptcy with the help of your Colorado Springs bankruptcy attorney, something called an automatic stay goes into effect. This is an operation of law that will prevent your lender from continuing any effort to repossess your vehicle while the stay is in effect, which usually lasts the duration of your bankruptcy case.
Chapter 7 is the most common type of personal bankruptcy filed in Colorado Springs, and it’s also referred to as a “liquidation bankruptcy.” By filing for Chapter 7, a person can eradicate most unsecured debts and some secured debts by giving up their assets. Those assets are then liquidated (sold) and whatever money is earned from the liquidation is then used to cover the bankruptcy petitioner’s debt.
In Chapter 7 bankruptcy, the Federal Bankruptcy Code allows each petitioner asset exemptions during the bankruptcy process. An exemption is a law that protects your property in bankruptcy. Exempt property can’t be sold for the benefit of your unsecured creditors. Colorado’s motor vehicle exemption allows bankruptcy filers to exempt up to $7,500 in equity in a motor vehicle they own.
The exemption, of course, won’t be helpful if your car has already been repossessed.
Filing for Chapter 13 bankruptcy in Colorado Springs may be a better option for residents who wish to keep their vehicle after the bankruptcy process, even if that vehicle has already been repossessed. Chapter 13 bankruptcy, also known as a wage-earners bankruptcy, allows the petitioner to consolidate all debt (including owed payments on a financed vehicle) and make payments on that debt over a fixed period of time. In other words, if you can make both your regular car loan payments and your repayment plan payments, you will be able to keep your vehicle.
If your car has been recently repossessed, filing Chapter 13 bankruptcy may be the best way to get it back. Generally, when a lender repossesses a vehicle, they wait (approximately 20 days) before selling the vehicle to recoup whatever they can of the remaining loan balance. If you file for Chapter 13 bankruptcy before the vehicle is resold, the automatic stay will halt the lender’s ability to sell the car, and it will be returned to you.
For more information on repossession and bankruptcy, read Debt.org’s Car Repossession article, or contact one of our experienced Boulder County area bankruptcy attorneys for a free case consultation.
Even if your debts exceed your ability to pay your car payments, you can take back control of your finances and avoid repossession. There are legal options available to solve your financial problems, regardless of your circumstances. Whether you want to file for bankruptcy or find another viable solution, you need the help of an experienced El Paso County debt relief attorney.
We’re in the business of solving financial problems, whether it’s the threat of repossession, wage garnishment, or foreclosure, and we’ll give you the personal attention needed to do just that. Our goal is to answer your questions, assuage your concerns, and provide the insightful consultations you need to make confident, informed decisions. We want to streamline the bankruptcy process, and we want to be there to support you throughout the process and beyond. Contact our Colorado Springs bankruptcy lawyers today for a free case consultation.