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Ask yourself this question – can you live without your car? Most Colorado residents use their car throughout the day. Without it, would you be able to get to work? How would you go to the grocery store or pick up your kids from school?
Obviously, most Colorado residents need their car to function, which is why having your car repossessed can be devastating.
If your car, truck, motorhome or other financed property is in danger of or has already been repossessed, bankruptcy may be the debt relief help you’re looking for. Our helpful Lakewood bankruptcy attorneys have designed this webpage to give you insight into how bankruptcy can help halt repossessions in Jefferson County. For more information, please contact our team of experienced Lakewood debt relief lawyers.
The answers you seek are just a phone call or email away and best of all, your consultation is free.
If you’ve found this website because something you’ve financed, such as your car, motorcycle, or wedding ring has been repossessed in Lakewood, don’t panic. You have options.
One of the most important things you should know is that you need to act quickly – you only have about a short window of time to try and get your property back before it’s too late. That’s because the business that sold you the original item will attempt to re-sell the (now used) item to recover at least some of the money they lost.
The way our Lakewood bankruptcy attorneys see it, there are four actions you can take when your property has been repossessed in Jefferson County:
1. Pay missed payments to the lender
This is obviously the first, best option for Lakewood residents looking to retain their repossessed property. Contact your lender and see if you can get the item back by making up the arrears. Occasionally, the lender may demand that you pay off the entire loan before allowing you to take possession of your repossessed property. They may also deny your request, which they are legally allowed to do. In most cases, however, the lender will let you pay the arrears plus any repo charges incurred to get the property back. Note that this tactic usually only works if this is your first repossession. Most lenders aren’t amenable to returning property to people who have several repossessions on their record.
2. Pay the entire loan off
If you have the funds available, you can contact the financier and ask to pay the entire loan off, and never have to worry about missing any payments on that car again. Obviously, if you’re already deep in debt, this is the least feasible option. Our Lakewood bankruptcy attorneys understand that not everyone has the luxury of having this much money on hand, especially on short notice. Chances are, if you’re here reading this, you’re in debt beyond just missing some car payments. But it’s worth including in this list, however unfeasible it may be.
3. File Chapter 13 Bankruptcy
Chapter 13 bankruptcy is one way to force a lender to give back repossessed property immediately without paying them any money. If the amount the lender demands to give back your asset is too high, and they still haven’t sold off your repossessed item, filing Chapter 13 bankruptcy in Lakewood can force them to give the property back and take payments over time.
Additionally, if you qualify, and the property that has been repossessed is a vehicle, there is another benefit to filing Chapter 13 bankruptcy– the cramdown. 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, and your experienced Lakewood bankruptcy lawyer can help you figure out if this is a valid course of action for you.
4. Let the item go
Sometimes it’s best to just let the asset go. If you’re likely to miss more loan payments due to your other debts, it’s probably not worth it to try and get back property you can’t afford to keep. However, you may still be liable for a deficiency. A deficiency is the amount of the original loan that remains unpaid after the lender has sold your repossessed property to cover the bulk of the loan balance. It’s worth noting that 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.
If you’re struggling with debt and behind on your car, furniture, or other secured debt payments, aggressive debt collectors may be quick to try and repossess your assets This can be devastating, as you probably rely on these items for work or other aspects of your life. Repossession can have a very negative effect on your credit score and make it difficult to finance another loan in the future.
If you’re struggling with debt and facing repossession, you may be considering bankruptcy as a way to get a fresh start. But what type of bankruptcy is right for you?
There are two types of individual bankruptcy filings available to Lakewood residents seeking debt relief- Chapter 7 and Chapter 13. Regardless of which chapter you choose, when you file for bankruptcy in Jefferson County, an automatic stay goes into effect. The automatic stay is a court order that stops creditors from taking collection actions against you. That means your creditors can’t repossess your car or other property during the duration of your bankruptcy case.
There are other benefits to an automatic stay, including halting home foreclosure and ending wage garnishments. For more information about automatic stays, please contact our Lakewood bankruptcy attorneys.
Chapter 7 bankruptcy is the most commonly filed bankruptcy petition in Colorado, and is sometimes called ‘liquidation bankruptcy.’ That’s because, in a Chapter 7 case, the trustee appointed to oversee your case may sell or liquidate some of your assets to pay your creditors. But in most cases, filers don’t lose any property in a Chapter 7 bankruptcy, thanks to Colorado’s generous exemptions. Chapter 7 bankruptcy will discharge all unsecured and some secured debt, including the arrears on your financed item, however, it won’t cover the payments that are due during the duration of your bankruptcy case. Therefore, if you wish to keep your financed property after your Chapter 7 bankruptcy case has ended, you must keep current on your loan payments.
The other type of bankruptcy case available to individuals seeking debt relief is Chapter 13 bankruptcy, which is sometimes called a ‘reorganization’ bankruptcy. That’s because, in a Chapter 13 case, you work out a repayment plan to repay all or a portion of your debts over a three- to five-year period. 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 “payment’ will then be up to date.
Like Chapter 7 bankruptcy, when you file for Chapter 13, you’re protected from collection on loan arrears during the duration of your case. But that doesn’t mean you get to keep the asset without some provision for payment. If you’re unwilling or unable to pay the current loan payments, you’ll need to consider giving up the asset during the bankruptcy process.
Extensive debt and repossession often go hand in hand. If you’re struggling with debt and want to stop the repossession process before it gets started, it’s essential that you retain the services of an experienced Lakewood bankruptcy attorney. For a free consultation about your bankruptcy options and how to stop repossession, contact our firm today.