Many citizens of Florida, who are thinking about filing for bankruptcy, believe that they are allowed to keep only one of their cars in bankruptcy because the statutes of Florida have an exemption of up to $1,000 for only one motor vehicle. There is also a wildcard exemption of $1,000 and also a house or an additional wildcard exemption of $4,000, available in Florida. The debtor can use these exemptions for retaining a vehicle also. So, in case the debtors own vehicles worth less than $4,000, they can keep all of them with themselves. Remember that the exemption amounts can only be used on vehicle equity. A car worth $4,000 and with a balance of $5,000 on the note will have no equity, and thus, the debtor can keep it without any exemptions in bankruptcy.
In Chapter 7 bankruptcy, a vehicle with too much equity can be kept using two ways. The first way is to take a loan from a bank and keep the vehicle as a security. The loan money can be utilized to pay for the necessary and reasonable living expenses, including the attorney’s fees. After this, the debtor can reaffirm the car debt and keep the vehicle in bankruptcy.
Another way to keep a vehicle is to sign a buyback agreement with the bankruptcy trustee. In case you are unable to exempt your vehicle, the trustee will be responsible for auctioning off your car. Thus, they might be willing to re-sell the car to you for a lesser amount than the original value of the car. This way they won’t have to pay any fees for action or repossession. You will also be allowed to make these payments over a reasonable period of time, often as long as a year.
In order to know more about your chances to keep your vehicles with yourself in a bankruptcy filing, visit www.recoverylawgroup.com or call on 888-297-6203.