Thinking about bankruptcy? The bankruptcy lawyers at King and King LLC in Atlanta, Georgia can help. Call 404-524-6400 for a free bankruptcy consultation.
We know having a car is essential for most people to get to
work and earn a living. The good news is filing for bankruptcy will immediately
stop an auto lender from repossessing your car.
There are two courses of action that are successful for most
King and King clients to not only stop repossession but to also lower car
payments. One option is to use a redemption loan in a Chapter 7. A redemption loan allows you to pay back only
the market value of your vehicle, which for many people is much less than what
they currently owe on their car loans. A
second option is to file a Chapter 13 and “cram down” your loan: many people
can lower both the interest rate (to as low as around 4%) and also only pay back
the market value of the vehicle. This
can result in a tremendous savings.
Fortunately, there are several options that can enable you
to avoid repossession and keep your vehicle while still obtaining debt relief.
King and King Bankruptcy attorneys can stop repossession
immediately and take the actions needed to help you get debt relief. Call
404-524-6400 for a free consultation or visit us at www.kingandkingattorneys.com for
more information.
Chapter 7 bankruptcy wipes out most, if not all of your debt,
leaving you with a clean slate. In order
to qualify for chapter 7 bankruptcy, you must pass a "means test." The test analyzes your income over the
previous six calendar months and projects an annual income. The means test is very tricky; talk to an experienced
bankruptcy attorney to find out if you qualify.
Chapter 13 bankruptcy allows you to pay back your debt over
time. In order to qualify for a Chapter 13 bankruptcy, you will need to meet
two general income requirements. First, you must have a regular source of income.
Second, you must have sufficient disposable income. Basically you must have at
some income left over to pay to creditors after you subtract your living
expenses from your monthly income. Chapter 13 bankruptcy often provides much
greater protection to debtors who own significant assets or have income that
would not be exempt in a Chapter 7. Most people filing for Chapter 13
bankruptcy are trying to protect a secured debt from being foreclosed or
repossessed, such as a home or a car.
King and King will evaluate your situation and determine if
Chapter 13 or Chapter 7 bankruptcy is right for you. Call our office today at 404-524-6400
for a free, confidential consultation to discuss your options or visit us at
www.kingandkingattorneys.com.
Chapter 7 bankruptcy is also known as a "Fresh
Start" bankruptcy. Chapter 7 bankruptcy allows you to eliminate most or all of your debt, such as personal
loans, medical bills, and credit cards, while being allowed to keep most if not
all of your property.
Once you decide to file Chapter 7 bankruptcy, King &
King will begin the process immediately to stop creditor harassment and threats
from lenders. If your wages are being garnished,
filing Chapter 7 bankruptcy will stop the garnishment immediately.
In most cases in the state of Georgia, you will be able to
keep your home and your car. Bankruptcy
is not intended to hurt, it’s intended to help.
Chapter 7 does not eliminate:
Student loans, except extreme hardship cases
Recent tax debt (although stale tax debt is usually
dischargeable)
Debts for alimony, maintenance or support
Debts for fines, penalties or criminal restitution
Debts for personal injuries caused by driving intoxicated
Chapter 7 is the most commonly filed bankruptcy and can
allow for a new start. More and more Americans find themselves struggling with
debt they cannot control. Chapter 7 bankruptcy allows for their debt to be
discharged and lets them get in control of their financial situation.
To discuss your bankruptcy options, including Chapter 7 bankruptcy, with a knowledgeable King & King attorney in a free initial
consultation, contact us today. Timing is always important in
bankruptcy-related matters. The sooner
you contact us, the sooner we can begin helping you get your life back on
track. Call today 404-524-6400.
If you or a loved one is facing repossession or is behind on
car payments, you’re not alone. The economy, job loss, medical bills: these are
all common reasons many people fall behind on their car payments and face
repossession. When you get behind on car payments, the lender can repossess the
vehicle. In most vehicle loan contracts, there are clauses that allow the
repossession of your vehicle should you fail to make the scheduled payments. If
you have received notice that your car is going to be repossessed, your first
step is to contact the lender and arrange to pay the past due amount. However,
many people are not in a position to do that, which is when filing a Chapter 13 bankruptcy may be the best option. Chapter 13 can stop the repossession of your
vehicle and allow you to pay back the lender over time through a Chapter 13
re-payment plan. You can probably also
reduce the interest rate that you agreed to pay to the lender. This can save you a lot of money.
If your car has already been repossessed, you may be
responsible for the unpaid balance of the loan once the vehicle is sold. If
this is the case, bankruptcy may still be the best option for you, as it will
protect you from collections, judgments, and possible wage garnishment. Whether
you have a prior repossession or are struggling to save your car, King and King bankruptcy attorneys can help. At King
and King, we have helped individuals and families in Georgia save their homes,
their cars and their hard earned wages. Having an attorney who knows how to
protect you and your property is vital. Call today for your free consultation.
404-524-6400
Posted on October 24, 2012 King and King Bankruptcy Attorneys
With the economy in trouble like it has been for the past
few years, you have probably heard or even know people that have pursued
bankruptcy to ease the financial burden of an underwater mortgage (owing more
on a mortgage than it is actually worth).
A similar question that is becoming more and more common is
whether or not people can use bankruptcy as a release for the financial burden
of an underwater auto loan. While each situation is considered unique and
therefore could provide different outcomes, if you are facing an underwater car
loan there are a few potential bankruptcy options that you can explore with
your bankruptcy attorney.
Chapter 7 Bankruptcies
Chapter 7 bankruptcies provide several options for debt
relief, including some that may allow you to keep your car. As always, your
options will depend on your specific situation. Here are a few options under Chapter
7:
Surrender the vehicle
Surrendering your car is an option to reduce the burden of
auto payments and insurance. However, this is not a viable option for most
people since they need their transportation to get to and from work.
Redeem the loan
Through judicial approval, you may be able to reduce your
car debt to the fair market value. In other words, if your loan balance is
$8,000 and your car is only worth $4,000 you may be able to reduce the balance
of the loan by $4,000. Depending on your situation, your payment requirements
may be either monthly payments or a lump sum payment. There is often a tradeoff
of higher interest charges, so it’s important to run the numbers to see if a
redemption will help you.
Chapter 13 Bankruptcies
In Chapter 13 bankruptcies, your options are different. You
may choose to keep the car and have it rolled into your bankruptcy, where you
will pay some portion–often a fraction–of the balance as part of your payment
plan. If you’ve owned your car for more than two and a half years, you may
qualify to have your outstanding balance adjusted to Fair Market Value and
stretch the payments out over the life of the bankruptcy. In some cases, you
may be able to keep your car and pay off your debt for a very modest monthly
payment.
As you can tell, there are many choices in bankruptcy when
it comes to your auto loan. If you want to keep your car, it’s important to get
expert advice. If you are exploring the possibility of filing for bankruptcy,
schedule a free consultation to learn about your options with an Atlanta, Georgia
Bankruptcy Attorney, by calling 404-524-6400. Contact us today.
Bankruptcy and Auto
Loans – Saving Your Car in Bankruptcy
King and King Bankruptcy Attorneys 8/30/2012
If your vehicle is worth less than you owe, or you are
paying excessive interest, Chapter 13 bankruptcy can reduce your balance, cut
your interest rate, and slash your payment. A “cram down” of an auto loan is a
major benefit available only in Chapter 13 bankruptcy.
Bad car loans can be financially devastating. As a bankruptcy
firm in Atlanta, we have seen clients with auto loans nearly two times the
value of their vehicles and at higher than 20% interest. However, it is not
only debtors with egregiously bad loans who benefit from Chapter 13 cram downs.
Unexpected depreciation of a vehicle’s value and a modestly high interest rate
will quickly place almost anyone underwater on a car loan.
Bankruptcy and the
Balance on an Auto Loan
Cramming down your car loan balance in Chapter 13 reduces
the balance to the vehicle’s fair market value. This new lower amount is paid
through your Chapter 13 plan. Although a creditor may object to the value that
you propose, courts will generally accept the average Bluebook value. Any remaining balance becomes an unsecured
debt like your credit cards, medical bills, etc. Because most Chapter 13 debtors pay only a
small portion of their unsecured debt, cramming down the balance can save you
thousands of dollars.
Time is a Factor
To be eligible to cram down the balance on an auto loan, you
must have purchased the vehicle at least 910 days (a little over 30 months)
from the date that you filed your Chapter 13 bankruptcy. Even if your car was
purchased within 910 days of filing, most clients are able to lower their
interest rate to a much lower rate than the one the financing company offered
them. Many of our clients are able to save thousands of dollars of
interest this way.
Speaking with an experienced bankruptcy firm such as King
and King, serving Atlanta for over 30 years, is the first step to your
financial freedom. Call us today for a free consultation 404-524-6400
