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Terry L.
Terry L., Attorney
Category: Bankruptcy Law
Satisfied Customers: 2815
Experience:  Better Business Bureau. 18yrs bankruptcy experience. Chicago Bar Assoc. American Bankruptcy Institute member.
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I am thinking to file bankruptcy under chapter 7. I have a

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I am thinking to file bankruptcy under chapter 7. I have a car that I am making payments on. I have negative equity in the car. I owe more than what the car is worth. Would I have to relinquish my car under chapter 7 or would that debt be eliminated also?
Submitted: 7 years ago.
Category: Bankruptcy Law
Expert:  Terry L. replied 7 years ago.
You have 3 options for a car in chapter 7.
1. surrender car, discharging the debt and getting something else.
2. reaffirming the car- keep the same payments and balance, signing an agreement to let the debt survive bankruptcy so you may keep the car.
3. Redemption. you can buy the car for the fair market value, and have the judge strip off the over-financed portion of the car over the fair market value. This is done by motion. There are companies willing to finance the fair market value as well, since most debtors don't have that kind of money laying around. Search google for 722 redemption.
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