Your Car In Bankruptcy

Everett has some decent options for public transportation. However, they don't take you everywhere. So when you lose your car in the city, you lose access to our great city. Nevertheless, you have some legal options to keep your car if you have received a repossession notice in Snohomish County.

We can help you. For 30 years, our Everett attorneys have helped Washington State drivers find relief through bankruptcy protection. Contact us now at our law offices to schedule a free consultation.

In Snohomish County, filing for bankruptcy can provide immediate relief by triggering an automatic stay (11 U.S. Code § 362), which legally stops repossession efforts. However, what happens after the automatic stay depends on the type of bankruptcy you file.

• Chapter 7 Bankruptcy: Temporarily stops repossession but may require you to surrender the car unless you can catch up on payments or reaffirm the loan.
• Chapter 13 Bankruptcy: Allows you to restructure past-due payments into a manageable repayment plan, helping you keep your vehicle.
• Redemption Or Reaffirmation: In Chapter 7, you may be able to pay the car's market value to keep it or reaffirm the loan.
• Lender Violations: If a lender repossesses your car after filing, they may be violating bankruptcy laws, and we can take legal action.

Stopping repossession is possible, but timing is critical. If you're in danger of losing your vehicle, our Everett bankruptcy attorneys can help you explore the right legal options to protect it.

Filing for Chapter 7 bankruptcy in Snohomish County provides relief from debt, but what happens to your car depends on multiple factors, including your loan status:

• If You're Current on Payments: You can keep the car by reaffirming the loan with your lender.
• If You're Behind on Payments: The lender may still repossess the car unless you bring the loan current or redeem the vehicle.

If keeping the car isn't financially feasible, you can voluntarily surrender it and have the debt discharged. You can also explore a redemption option where you can pay the lender a lump sum for the vehicle's fair market value instead of the entire loan balance. Further, you can protect up to $3,250 of your car's equity under RCW 6.15.010 or more through a federal exemption.

Every situation is different, and keeping your car depends on the details of your case. Our Everett bankruptcy attorneys can help you assess whether Chapter 7 is the right option for you.

Chapter 13 bankruptcy offers a structured way to keep your car while catching up on missed payments. It's a powerful option for those who are behind on their car loans but want to avoid repossession.

• Repayment Plan: Past-due payments are spread out over a 3- to 5-year repayment plan, making them more manageable.
• Lower Loan Balance (Cramdown Option): If your car loan is more than 910 days old, you can reduce the loan to the car's actual value.
• Interest Rate Reduction: Chapter 13 allows you to restructure your loan with a lower interest rate, reducing overall costs.
• Lien Satisfaction: Once your repayment plan is complete, you settle the car loan, preventing future repossession.

Whether you live near Silver Lake, commute past Everett Station, or work in downtown Everett, protecting your car is crucial for your daily life. Our Everett bankruptcy attorneys understand local courts, lenders, and strategies to keep your vehicle safe while you regain financial control.

Keeping your car during bankruptcy is a top priority for many people in Everett, whether you rely on it for work, school, or daily errands. Our experienced Snohomish County bankruptcy attorneys can find legal ways to protect your vehicle while relieving your financial stress. Here's how we'll help you keep your car:

• Filing for Bankruptcy Quickly: Timing is critical if repossession is imminent. We act fast to stop it with an automatic stay with 11 U.S.C. § 362.
• Guiding You Through Chapter 13 Repayment Plans: We help restructure past-due car payments into a manageable 3- to 5-year repayment plan so you can keep your vehicle.
• Using Exemptions in Chapter 7: Washington State's motor vehicle exemption under RCW 6.15.010 protects up to $3,250 in car equity, and we ensure you maximize this protection.
• Negotiating with Lenders: We work with lenders to reaffirm your loan, adjust terms, or explore settlement options.
• Preventing Unlawful Repossession: If a lender repossesses your car illegally during bankruptcy, we take immediate legal action to get it back.

From the busy streets near Everett Mall to the quiet neighborhoods of Silver Firs, losing your car can disrupt everything. Contact our Everett law offices to stay on the road.

You don't have to choose between bankruptcy and your car. With a smart legal strategy, you will protect your vehicle and get a fresh financial start. Our Everett attorneys know how to navigate Washington State's bankruptcy laws and keep you on the road. Schedule your free consultation today with our bankruptcy lawyers specializing in repossession.

For most people, owning a car is essential to good financial health. Most people need a car to get to work and take care of themselves and their family. For this reason, bankruptcy law provides a number of ways to protect a car while eliminating a lot of debt.

A car is an asset and more expensive cars can be taken to pay creditors in a Chapter 7 liquidation case. The car federal and state car exemptions are about $3400. You can stack up to $11,975 of federal wildcard exemption on top of the car exemption. If you file a Chapter 7 and have a more expensive car that is paid in full, or several cars, you should be careful about choosing the right exemptions to protect these cars.

If you are file a Chapter 7 and are still making payments on a car, you can usually keep the car if you just keep making the payments. The car finance company will want you to sign a reaffirmation agreement, excepts the car loan from the bankruptcy discharge. That means you take on the risk of defaulting on the loan after the bankruptcy. If you fall behind on the car loan or the car is destroyed while the insurance lapses, you could find yourself in a lot of debt for a car you no longer have on top of having a bankruptcy on your credit report. A car company can repossess the car if you don’t file a reaffirmation agreement even if you are current. Many car finance companies will not repossess the car as long as you are current even if you did not sign a reaffirmation agreement.

Another option in a Chapter 7 is to give the car back and walk away from the loan. If a car has been repossessed before filing the bankruptcy, you may owe a car deficiency – the amount of the car loan left over after some of it was paid by the sale of the car.

One final option in a Chapter 7 is a redemption, which allows you to pay off a car loan in the amount of the car’s value only. Some finance companies specialize in loaning money to people in Chapter 7 for a redemption. If you are able to come up with the cash to pay the creditor the value of the car, you can do the redemption without financing. Either way, you need to file a motion and work out what the value of the car is in court.

Chapter 13 bankruptcy provides more ways of protecting cars. You can pay the value of car you can not protect with exemptions to creditors over five years. You can consolidate a car loan with other debt in the Chapter 13 payment plan. If you purchased your car over 910 days (two and a half years) ago, can “cram down” the loan and pay the value of the car only through the plan.