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I’m Already in a Bankruptcy and Can’t Afford My Payments. Will I Have to Give My Car Back? – Dawn

“Dear Steve,

I filed a chapter 13 in 2007, while receiving Long term disability and child support. Since then my child support has stopped due to non payment. My payments have been decreased but I still can’t afford the payments, my income is only $1,133 a month. I have a 2005 Chevy equinox in good condition with 94,000 miles. My recent personal property tax paper valued the car at under $13,000. I am scared that I will lose my only means of transportation. When I filed my car payment was $415 a month, if I reaffirm the debt I can’t afford that type of payment. i talked to my attorney, and they keep saying I will have to give the car back, there are no other options. Help me please. Are there any other options

Dawn”

Dear Dawn,

Do You Have a Question You'd Like Help With? Contact Debt Coach Damon Day. Click here to reach Damon.

It sounds like you need to convert your Chapter 13 bankruptcy to a Chapter 7 bankruptcy to deal with the reduced income.

I’d start by calling the current car lender and ask them what options exist for you to refinance the loan or restructure the loan to lower the payment.

They are not obligated to do so but it is worth a shot. If you could afford the $415 then it would probably be a simply reaffirmation.

Worst case scenario you’ll have to give the car back and get something less expensive, possibly a $1,000 car you can pay cash for.

Please update me on your progress by

P.S. Be sure to read ‘The Secret of Surviving Through Difficult Economic Times. What I Learned On My Journey‘.

Damon Day - Pro Debt Coach

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Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.
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