What Happens to Your Car in a Bankruptcy?
Keeping the car you love despite owing much more than it’s worth. How can bankruptcy help?
It is the exception rather than the rule that a person financing a vehicle owes less than or equal to the car’s value. Unless you put at least 20% down, chances are you are upside down. Bankruptcy not only can eliminate unsecured debts like credit cards, it can also drastically reduce what you owe on your vehicle.
In a chapter 7 bankruptcy, debtors can take advantage of section 722 of the Bankruptcy Code, also known as redemption. Under section 722, a debtor may redeem personal property intended primarily for personal, family, or household use provided they pay in full to their original lender, a value equal to the price a retail merchant would charge for property in like condition. The upside of redemption is that it essentially converts secured debt to unsecured debt to the extent the value exceeds what you owe. The downside is that you have to come up with a lump sum to pay the original lender. There are a few lenders out there who will finance people going through bankruptcy for this purpose.
Chapter 13 involves a monthly payment plan and also offers benefits for those who find themselves upside down on their vehicles. Generally speaking, if your car was purchased for you and your family’s use more than 910 days before the bankruptcy is filed, you repay only what the car is worth and not what you owe. This is called “cramdown.” The upside here is that your loan is recast up to a 5 year period reducing your monthly payment. The downside is you need to have bought your vehicle more than 910 days, or 2.5 years before the filing, unless the vehicle is primarily for business use. If that is the case then that 910 day rule does not apply. Check with a knowledgeable attorney to determine the best strategy for you.
The Larkin Law Firm is different from all the other debt centers and bankruptcy firms. Our law firm is not a bankruptcy mill that dispenses “one-size-fits-all” advice. SAN DIEGO BANKRUPTCY ATTORNEY Jeffrey D. Larkin provides individualized attention and customized debt solutions tailored to your specific situation.
At the Larkin Law Firm, the attorney and the client work together to solve the client’s problem with the right tool for the job, whether that is debt negotiation, consolidation, re-organization, re-finance, bankruptcy or some other solution.
Along the way toward re-organizing the client’s finances, we involve consultants such as accountants, bookkeepers and financial advisors — our goal is to restore your finances for life. SAN DIEGO BANKRUPTCY LAWYER Larkin is not a newcomer like so many firms that are appearing in the marketplace in response to current economic conditions. For years, Mr. Larkin practiced law with some of San Diego’s largest bankruptcy firms. In fact, attorney Jeffrey D. Larkin was among the top five highest filers in the San Diego bankruptcy court in San Diego County in 2008. With his vast experience in the bankruptcy courts, his advice merits your attention. For your free consultation with a SAN DIEGO BANKRUPTCY LAWYER, visit our website http://www.live-debt-free-now.com or call us toll-free at 1.877.25.NEW.HOPE.
Learning About the Bankruptcy Process - What is a “Notice of Abatement?”
Question: “During my bankruptcy, I received a ‘Notice of Abandonment’ from the Trustee! What does that mean?”
Answer: When a debtor receives a “Notice of Abandonment” from the trustee, they should not be alarmed. The title of the document oftentimes scares debtors into thinking they are going to lose the property listed in the notice, which is not the case.
Basically, a notice of abandonment is the trustee’s way of saying that for one reason or another, the listed property cannot be liquidated for the benefit of your creditors. When a bankruptcy case is filed, real and personal property become part of a “bankruptcy estate” which the trustee is in control of. Once the trustee reviews the case and determines he cannot make any money for creditors by liquidating specific assets, they will file an abandonment notice on these items.
The most common reason the trustee abandons an asset is because it is burdensome to the estate. For example, if you have a car worth $10k but owe $15k on it, the trustee will abandon the car because if he were to sell it he would have to first pay off $15k to the vehicle lender. If the car is only worth $10k, there would be no money left over to pay any other creditors. The same is true for real estate. If you owe more than your home is worth, or if the costs of selling the home (ie. Realtor fees etc.) eat up any money available for creditors, then the trustee will abandon the asset back to you.
Upon abandonment, the property is your to do with what you choose and is no longer part of the bankruptcy process.
SAN DIEGO BANKRUPTCY ATTORNEY Jeffrey D. Larkin is one of the most productive debt-relief attorneys in the region. His innovative law firm is committed to providing intelligent debt solutions custom fitted to his clients’ individual needs. Whether you need to file bankruptcy, re-organize your debt or re-build your financial structure, attorney Larkin provides a full range of legal services designed to restore financial order to your life.
Mr. Larkin is a California licensed attorney offering services throughout San Diego, Orange, Riverside and San Bernardino Counties. A 1998 graduate of California State University, San Bernardino, Mr. Larkin earned his Juris Doctorate from Thomas Jefferson School of Law in 2002. Since that time, Mr. Larkin has focused exclusively on bankruptcy and insolvency related matters, and has authored dozens of articles regarding bankruptcy and other debt solutions.
From 2002 through 2009, Mr. Larkin served as an associate attorney for the two largest bankruptcy filing firms in San Diego County. During that time, Mr. Larkin handled thousands of cases, and gained invaluable experience serving a broad and diversified client base. In 2008, Mr. Larkin was one of the top five bankruptcy filers in all of San Diego County, according to the United States Bankruptcy Court, Southern District of California.
You can reach Mr. Larkin by e-mail at Jeff@larkinfirm.com or by phone at 1.877.25.NEW HOPE. For more information about The Larkin Law Firm, go to http://www.live-debt-free-now.com for your free consultation with a SAN DIEGO BANKRUPTCY LAWYER today.
What is a “Short Sale?”
A short sale is the process of selling a piece of real property for less than what is owed on the loan(s). Short sales require the approval of the lender who will be affected by the sale, because the funds received will be”short” of what is owed on the loan. Depending on the borrowers current financial situation, there could be taxable consequences as a result of a short sale and forgiveness of debt. Short sales are notoriously slow to complete and the foreclosure process is not halted during negotiations absent something in writing to that effect signed by the lender. Borrowers considering this option are encouraged to work in collaboration with a real estate agent familiar with the short sale process and a knowledgeable attorney who can properly advise and counsel you on some of the common pitfalls associated with this rapidly expanding area.
If you are in need of selling a distressed home in a short sale, or if it is time to address overwhelming debt in your life, contact San Diego Bankruptcy Attorney Jeffrey Larkin. Mr. Larkin is one of the most productive debt-relief attorneys in the region. His innovative firm’s goal is intelligent debt solutions customized to his clients’ individual needs. Mr. Larkin has served as an associate for the two largest bankruptcy filing firms in San Diego. In 2008, Mr. Larkin was one of the top five bankruptcy filers in San Diego County, according to the U.S. Bankruptcy Court, So. Dist. of Cal. For more information please visit our SAN DIEGO BANKRUPTCY ATTORNEY website at http://www.live-debt-free-now.com or call his toll-free number 1.877.25.NEW.HOPE (1.877.256.3946) for a free consultation today with a SAN DIEGO BANKRUPTCY LAWYER
Falling Behind in your Payments?
Falling behind in your payments? Under financial pressure? We have your solution. Don’t fall for one of those bankruptcy mills, newcomers or phony debt-relief agencies that are suddenly appearing in the marketplace. You need an experienced bankruptcy lawyer to correctly advise you.
For the past seven years, attorney Jeffrey Larkin has been an attorney with two of San Diego County’s largest debt-relief law firms. Last year, he was among the top five most productive bankruptcy attorneys in the entire County. Bankruptcy mills only consider one option. Attorney Larkin will consider ALL of your options, and arrive at a debt-relief plan that is best suited to your particular situation.
Call now toll free at 1-877-25-NEW-HOPE (1-877-256-3946)or go to http://www.LIVE-DEBT-FREE-NOW.com for your free consultation with a SAN DIEGO BANKRUPTCY ATTORNEY. The initial consultation is FREE and $100 starts your case.
The Larkin Law Firm — Big Firm Knowledge — Small Firm Service.
The Larkin Law Firm
2768 Loker Avenue West, Suite 101
Carlsbad, CA 92010
The Larkin Law Firm is a debt relief agency. Among other services, we help individuals and small businesses file for bankruptcy under the Bankruptcy Code.
Bankruptcies on the Rise
In these tough economic times, more and more people and businesses are filing for bankruptcy. The federal bankruptcy statistics show that there have been 31.4% more filings in 2008 than there were in 2007 . It is not a stretch of the imagination that the number will increase more in 2009. Of the 95 regions that comprise the federal statistics, only 5 showed a decrease in the number of filings from 2007 to 2008. Those regions were the Northern District of New York, the Virgin Islands, the Middle District of Louisiana, the Southern District of Texas, and the Northern Mariana Islands. The region with the greatest increase was the Central District of California, who increased the number of people and businesses filing for bankruptcy 93.5% from 34,028 in 2007 to 65,856 in 2008.
San Diego bankruptcy lawyer Jeffrey D. Larkin is one of the most productive debt-relief attorneys in the region. His innovative firm’s goal is intelligent debt solutions customized to his clients’ individual needs. Mr. Larkin has served as an associate for the two largest bankruptcy filing firms in San Diego. In 2008, Mr. Larkin was one of the top five bankruptcy filers in San Diego County, according to the U.S. Bankruptcy Court, So. Dist. of Cal. For a free consultation with San Diego bankruptcy attorney Jeffry Larkin, go to http://live-debt-free-now.com or call him at 1.877.25.NEW.HOPE (1.877.256.3946) today.
