Chapter 13 bankruptcy is a powerful tool when dealing with secured debts like a car loan. You can use a Chapter 13 case to pay your car in full and stop repossession; but what do you do if the lender has already taken your car? A Maryland bankruptcy lawyer or a Washington DC bankruptcy lawyer may be able to help you get your car back.
When you buy a car and finance the purchase, the bank lends you the money in exchange for a lien on your car. That means that if you default on your payments, the lender can repossess the car, which means it can take the car from you. The lender can then sell the car at auction to satisfy the debt.
Bankruptcy automatically stops all collection activity, including repossessions. As soon as you file your Chapter 13 case, the Bankruptcy Code prohibits the car lender from taking the car from you. You can propose to repay the creditor through your Chapter 13 plan over a three-to-five-year period and come out of your case with a clean title.
If the creditor has already repossessed your car, you may still be able to get the car back. Both Maryland and Washington DC’s laws provide a 15-day redemption period for repossessed property. The lender who repossessed the car cannot sell the car until 15 days have elapsed since the initial taking. If you file a Chapter 13 bankruptcy before the lender sells the car, the lender must return the vehicle to you and accept reasonable payment through the Chapter 13 plan.
We Can Help You File for Bankruptcy in Maryland or DC
A Maryland bankruptcy attorney or a Washington DC bankruptcy attorney can help you get your repossessed car back, but you have to act fast, so contact knowledgeable counsel as soon as the lender takes your car.