Legal Question in Bankruptcy in Wisconsin

Re: Bankruptcy Vehilcle Surrender Questions

You have posed multiple questions to which there are no simple answers and which are serious enough to merit retaining an attorney for these limited purposes. You bankruptcy discharge can be denied for not following through on the statement of intentions regarding secured goods, which was supposed to have been filed with your bankruptcy. Not having seen that document, I obviously cannot comment on it. Generally speaking, amendments of all documents filed in a bankruptcy are permitted. But if you amend, remember that bankruptcy schedules are filed under penalty of perjury, and that inconsistent statements under oath can sometimes make perjury very easy to prove.

Addressing another one of your questions, if a vehicle secured by a purchase money lien is not reaffirmed, chapter 7 give you an opportunity to timely surrender the vehicle and "walk away" from the obligation with no liability. Again, I do not know whether you reaffirmed the obligation you are asking about and therefore could not advise you without reviewing the entire file. You can also rescind reaffirmations for a limited time.

Yet another "curveball" in this situation is the bankruptcy reform bill, which passed by congress this week. Although the new law does not go into effect for six months, it will make it impossible for most middle class debtors to file chapter 7. This means that the leftover debt following surrender of a vehicle (as well as all other debt) must be paid, at least in part, via a chapter 13 wage garnishment over a three to five year period. The exact amount to be paid is determined by the amount of disposable income you have, although there is often much disagreement over that amount. If you and the trustee are unable to agree on an amount, a bankruptcy judge makes the final decision.