A person, otherwise known as Chapter 13 debtor, who files a Chapter 13 bankruptcy case may generally retain a motor vehicle. In fact, if current on the loan payments, a debtor may make monthly payments on the loan outside of the Chapter 13 repayment plan. A debtor may also, with the consent of the trustee, continue to make monthly payments on this obligation in the Chapter 13 repayment plan.

A bankruptcy debtor that is not current on a car loan may provide in a Chapter 13 repayment plan for the payment of any loan arrearages. Whether current or not, debtors may also cram down a loan on a motor vehicle if certain requirements are met. Stay tuned for more on this in future blogs! Remember, Alberto Montefalcon has the experience and knowledge to help any person properly consider his or her options when faced with difficulties making payments on a motor vehicle, or any, loan.

If payments are current, the Chapter 13 trustee may allow the car loan to be paid outside of the Chapter 13 plan, which means that the debtor will simply make payments as they were made before the bankruptcy case was filed. However, at times, a trustee wants to monitor all car payments and may require them to be provided for within the terms of the chapter 13 plan’s repayment provisions. In this case, the Chapter 13 trustee collects the car payment monthly and pays the creditor or obligee of the car loan.

If you are behind on your payments and fear repossession, bankruptcy may a solution to keeping your motor vehicle. The experienced Sacramento metropolitan area/Northern California attorneys at the Montefalcon Law Offices are here to help you if your financial position necessitates the consideration of a bankruptcy case filing under Chapter 7, 11, or 13. Contact us online or schedule a consultation at any of our three conveniently located offices. Telephone our downtown Sacramento office at (916) 444-0440, our South Sacramento office at (916) 399-9944, or our Concord office at (925) 222-5929.