Using the Tampa Bankruptcy Process to Avoid Repossession
If you are faced with financial problems, there are many things that can keep piling on and can make the situation worse. This includes the repossession of assets such as automobiles, televisions, major appliances, boats and other property. You may even be receiving disconnect notices on your utility bills because you have fallen behind. In Florida, filing for bankruptcy will create an automatic stay that puts an immediate halt to repossession and may allow you to keep those possessions.
Our team of Tampa bankruptcy lawyers have filed tens of thousands of bankruptcies to provide debt relief to individuals and families. Under Chapter 7 or Chapter 13 bankruptcy, we are able to stop repossessions, foreclosures, and creditor harassment.
We are able to do this by first reviewing your situation through a bankruptcy evaluation. It is through this evaluation that we determine which type of bankruptcy is right for you. Once the bankruptcy petition is filed with the court, the automatic stay is in place. Keep in mind that you may receive calls from your creditors until they receive notification of the stay. However, you can keep them from calling you again by informing them of the bankruptcy filing and providing your attorney’s contact information.
Bankruptcy Can Help Solve Financial Problems
Both Chapter 7 and Chapter 13 can stop repossession efforts immediately. When you come to our firm, we will find out what property you want to keep and design a strategy for debt relief that helps you meet your financial needs. We may be able to help you prevent the repossession of or recover possessions such as cars, trucks, furniture, personal property, boats, jewelry and more.
There are times, however, that it may not make sense to keep those possessions. For instance, a car that you cannot afford will leave you still struggling to pay for it even after the bankruptcy is complete. In other cases, it may make more sense to stay current and do what is necessary to keep your property. Our firm will use our experience to guide you through the process and meet your goals.
The Effect of Bankruptcy on Repossession
When repossession is stopped by filing bankruptcy, the lender cannot repossess the property without getting approval from the court. There are some creditors that go this far so they can take the property. If it is important for you to keep the property, such as in the case of a car, you may be able to use the automatic stay period to rectify the matter with the lender.
If you decide to do what is possible to keep the property, you will need your attorney to assist you because most bankruptcy filers only have a few months. Once a bankruptcy case is closed, particularly in a Chapter 7 case, the stay is gone and that leaves the property open for the lender to repossess.
If you want to prevent repossession completely, there are some options that you can discuss with your lawyer. Those options are:
- Negotiate the loan terms with the lender – You have at least a few months to negotiate something with the lender. You want to do this during the stay because the discharge of the bankruptcy eliminates your personal liability on the debt. This gives the lender some incentive to negotiate new terms.
- Catch up the payments – The automatic stay also gives you a chance to catch up the payments in order to cure the default. If you do this, the lender doesn’t have a reason to take the property. They are in a better position if you can continue paying on the loan.
- Redeem the property – In the case of automobiles, you can buy your car back from the lender at its fair market value. This wipes out the lien the lender has on the car. Individuals that do this do so at a cost that is much less than the balance of the loan. However, only those that can afford doing so can do this and permission has to be granted from the court.