Orlando Repossession Attorney
If you have an overwhelming amount of debt you are struggling to repay, you may fear that certain assets of yours may be repossessed. Repossession is an action parties can take when they have the right of ownership of certain types of property. The rightful owner can take back the property to recover some of the debt. Repossession does not invoke court proceedings. For example, if you have a vehicle and fall behind on auto loan payments, the lender can repossess the car and take it back. Fortunately, you do have options if you are facing repossession. Our Orlando repossession attorney explains what these are below.
An Automatic Stay Stops Repossession
If you have a significant amount of debt you cannot afford to repay, you may have already considered bankruptcy. In both Chapter 7 and Chapter 13 bankruptcy, an automatic stay is issued as soon as you file. The automatic stay prevents creditors and lenders from taking further action to recover the debt. This includes repossessing property. While the automatic stay remains in place for the duration of your bankruptcy case, it is important to know that it is only temporary. Due to this, it is important to understand your long-term options.
Avoiding Repossession with Chapter 13 Bankruptcy
Chapter 13 bankruptcy is a good option if you want to stop repossession and you also want to retain ownership of the property. During the Chapter 13 bankruptcy process, you will create a repayment plan that reorganizes your debt. Chapter 13 repayment plans can extend between three to five years, which can result in lower payments over a longer period of time. This can make it easier to make payments on the property and protect it from repossession.
There is also an option known as ‘cramdown’ in Chapter 13 bankruptcy. This option allows you to pay only the value of the property and not the total amount you owe on it. For example, your car may be at risk of repossession and you may still owe $20,000 on the loan. If your car is only worth $12,000, the cramdown option allows you to only pay the $12,000.
Avoiding Repossession with Chapter 7 Bankruptcy
Chapter 7 bankruptcy is often a good option for borrowers who no longer want to keep the property and want to discharge the remaining debt. Still, it is possible to retain possession of the property when filing Chapter 7. This is done through a 722 redemption, which creates a new loan for the property. Staying with the above example, a Chapter 7 bankruptcy would allow you to obtain a new loan for the $12,000, rather than the original $20,000 you owed prior to filing bankruptcy.
Our Repossession Attorney in Orlando Can Advise You of Your Options
Facing repossession is extremely stressful. At Florida Law Advisers, P.A., our Orlando repossession attorney can advise you of your options to stop the process so you can protect your property. Call us today at 1 (800) 990-7763 or contact us online to schedule a consultation with our experienced attorney and to get the legal help you need.