If you are reading thing you probably are worried that your car is going to be repossessed or it has already gotten repossessed. A repossession on a credit report is certainly not something to take lightly. Many times when a vehicle is repossessed many people are surprised to learn that they still owe the car company money even though they no longer have the vehicle. Let’s take a look at why after you have suffered from a repossession you still owe the lender money.
Why Lenders Sue After A Car is Repossesed
Usually, when you go to the lot to finance a vehicle you sign a contract. Under that contract you agree that you are going to pay the loan off on the vehicle. When you do not pay the loan on the vehicle off and your car is repossessed you are still liable. This is because usually loans are worth more than what the car is valued at. As many of you know that a brand new car at the dealership can be worth $50,000 but the minute that car is driven off the dealership lot it can lose a few thousand dollars in value. Thus many times what people owe is still the $50,000 dollar loan even though your car is no longer worth $50,000.
The Lender Waited Years Before they Sued Me For Repossession
Many times people are surprised when their vehicle is repossessed because the car company many not initiate the lawsuit right away. Many times clients come to me years later saying that their repossession has come back to haunt them because the car company is now suing them for the balance they owed. If you have a repossessed vehicle and are in this situation then one of your options to get rid of the repossession on your credit report is to file bankruptcy which will also stop the lawsuit.
Debt Due to Reposession Can Be Included in Bankruptcy
When you file a Chapter 7 Bankruptcy the repossession can be included as a debt. This means that if your bankruptcy is granted and you get a discharge you were no longer be liable for the remaining balance on your repossession .
If you are located in New York or New Jersey and are looking for a bankruptcy attorney call Karra L. Kingston Esq. today. Our office can help you determine if bankruptcy is the right option for you. Karra L. Kingston Esq. practices bankruptcy in New York and New Jersey. She also speaks Spanish. If you want to get a repossessed vehicle off of your credit report or are scared that the creditor who repossessed the vehicle will go after you call today for a free consultation.