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You can take thousands off your car loan! Find out how.

FIling for bankruptcy doesn't mean you have to give back all your property. It also doesn't mean you have to continuing paying an outrageous amount for your existing vehicle. You filed bankruptcy so you could free yourself of the burdensome debts that were bringing you down. Fortunately, you have a right under Federal Law to keep your vehicle by paying what it is worth, not what you owe.

Your car is essential transportation to and from work, to pick up your kids, and to get around for groceries. Your car is valuable to you, but you may owe far more on your car than it is really worth. Most of the time, you have very few options with your vehicle in a bankruptcy. Normally, lenders do let you keep your car, but require that you continue making your high monthly payments until your loan is paid in full. The other option is giving back your vehicle, leaving you without a viable means of transportation. However, there is an option called redemption, which has potential for great savings.

When you redeem property in a St. Louis Chapter 7 bankruptcy, you essentially buy it back from the creditor in one lump sum and save thousands of dollars. The amount you pay is the “replacement value” -- the price a retail merchant would charge for property of that kind, considering the age and condition of the property at the time you redeem it. In many cases, the replacement value is less than what you owe on the debt. There are some qualifications to redeem a vehicle in a Chapter 7. Generally, a vehicle must be less than 10 years old and have less than a 150,000 miles.

In order to pay this lump sum and save thousands, you may need to take out a loan to help pay the redemption amount. There are a few lenders out there that will help procure a loan to help out. One of them, 722 Redemption, even helps clients prove valuation of their vehicle, ensuring clients get the best deal.

In a St. Louis Chapter 13, clients have a similar option to save money on their car payments, but the terms are a bit more complicated. Chapter 13 clients can "cramdown" the loan amount of the car to the amount the car is worth, which is then paid as part of the Chapter 13 repayment plan. The additional requirement in a Chapter 13 is that the vehicle must have been purchased at least 910 days prior to the bankruptcy. This prevents some types of fraud.

If you have a car payment that is getting unbearable, you definitely have options. There are affordable options for you to get your payment down in a Bankruptcy. Often times, this more than pays for the costs of filing bankruptcy several times over! Contact a local Missouri attorney for more details about saving money on your vehicle.

Since 1997, the St. Louis attorneys at The Law Office of Tracy A. Brown, P.C., have helped hundreds in Saint Louis stop creditors from harassing, garnishing, and threatening clients through Chapter 7 and Chapter 13 bankruptcy filings that alleviate excessive debt. Contact us today to free your future from your past.

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