We all know the embarrassment, frustration, and helpless feeling when someone’s car is repossessed. Even though most people haven’t been through it themselves, it’s easy to imagine precisely how it would feel. It’s something that everyone worries about when they struggle to keep their heads above water. After all, car repossession estimates reached nearly 1.5 million vehicles for 2023, according to Yahoo Finance.
You don’t have to learn firsthand what a car repo feels like, even if you are underwater on your finances. Bankruptcy can protect your car from creditors. Here’s what the bankruptcy experts at Kain + Henehan want you to know about stopping car repossession with Bankruptcy in Saint Cloud, MN.
Bankruptcy Protects Some Assets From Creditors
Bankruptcy is a process of accounting for all your assets and debts and then finding the best way to pay those debts with whatever assets you have or could acquire. Put simply, anything you have of value can be sold to use your debts, and the court ensures it is done as efficiently as possible to minimize your losses. However, there are certain things that the legal system won’t include as assets in a bankruptcy case.
The list of exemptions for Minnesota and the federal government includes, among other things, your primary vehicle that is not used for work purposes. That means your car is a protected asset in bankruptcy, even if you owe money.
Bankruptcy Stops All Collection and Repossession Efforts Immediately
Bankruptcy immediately stops all collection efforts against your estate, meaning all creditors must stop hassling you for money or threatening to repo your belongings. This includes repossession attempts on your car; they cannot repossess the vehicle in bankruptcy.
Instead, all creditors must file claims with the bankruptcy court to recover the car’s value. In most cases, you won’t lose your vehicle, no matter how the bankruptcy works out. The law recognizes that you need a vehicle to function in society, like going to work or taking care of responsibilities. The system makes it easy not only to keep the car that you have but also to pay it off after bankruptcy.
Learn More About Asset Protection In Bankruptcy
Bankruptcy can be scary, but it’s not as bad as people and the media make it out to be. It’s a system that is there to give you some relief from high debt and give you a chance to start over. You can learn more about asset protection in bankruptcy from Kain + Henehan, Minnesota bankruptcy attorneys.
Contact Kain + Henehan at (612) 438-8006 or complete the online form to schedule a free consultation. We can help you prepare and file for bankruptcy to protect your car, house, and other essential assets.
