Legal Question in Bankruptcy in New York

Re: Is there an alternative to bankruptcy for disposing of a car?

Why not just sell the car? If it is worth the amount you owe or more - than the money you receive from the sale pays the loan. If the market value of the car is less than the loan you owe then you need to either renegotiate the loan or do a voluntary re-possession - ie, just turn the car in. This is a problem however since if you let the lender repossess the car you will still owe the difference between the the amount you owe the lender and the market value of the car. This becomes an unsecured debt and you owe it to the lender. Bankruptcy can get rid of that but I don't think bankruptcy is worth it just for one loan. Besides if you file a bankruptcy you are required to list all your debts. You cannot just file for one debt.

Re: Is there an alternative to bankruptcy for disposing of a car?

This is not an unusual situation. The first thing you should do is go to the holder of the mortgage and make an appointment. They may choose to make a new arrangement with you. This is especially true if the mortgage is still owned by the car dealership.

Do not underestimate this option. This usually will solve the problem. The mortgage holder does not want the expense of re-possessing the car or suing you. They will usually make a settlement.

If that does not work, then you have other options. Most of these revolve around selling the car yourself or surrendering the car to the mortgagor.

Try the appointment with the mortgagor first, then get back to me.

If you are not comfortable, I can handle the matter for you by conference call.

You are welcome to a consultation for no fee at my offices at 42 West 44th Street, New York, NY. Please call for an appointment first; (646)- 591-5786