Legal Question in Credit and Debt Law in California
I purchased a car in late 2005 and was making payments, I was laid off in Dec. 2007 and continued to make payments, in Nov. 2008 I was involved in an auto fender bender, where I was at fault, however the other party did not pursue the matter any further and at the time of the accident my insurance was lapsed for a week. I contacted the my insurance co. and they advised that they would not cover damages, due to the lapse. So I started researching how much it would cost me out of pocket to fix the vehicle. Meantime, while temping and trying to get a permnent position, I continued to make payments, until it became a hardship. My question is there any legal way to break a contract, if your financial situation has drastically changed? I reside in the state of California.
1 Answer from Attorneys
Generally vehicle finance companies will repossess, sell the collateral, then sue you for the difference or deficiency. Unfortunately, creditors don't forgive debts just 'cause times are tough. Bankruptcy is a powerful means to eradicate debt and that option should be explored.
Disclaimer: the above as well as any information found on our Web site is not legal advice and should not be relied upon. It does not create an attorney-client relationship. Unilateral communications may be misconstrued as they do not address all facets, nuances, and particulars, or all means of addressing a situation. This is strictly my opinion provided for general informational purposes and it pertains to California law. We do not review and are not responsible for the content of other attorneys� answers even when they answer the same questions. We recommend you seek legal and other professional counsel before acting or refraining from action in relation to bankruptcy. It's worth the cost.
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