I filed chapter 7 in Utah and I'm now including all of my debts and other things like that. I want to keep my vehicle (if possible), so I don't know if I should include it in the bankruptcy or not or if it is a question that can be answered by someone in here, generically!
My car is worth $5,000, I owe the bank $2,000. Will I lose it if I include it, or not?
If you need additional information, please ask!
You have no choice. You must list all of your assets and liabilities.
What is the NADA book value? According to the statute 71-23-8(b)
"(b) An individual is entitled to an exemption, not exceeding $2,500 in value, of one motor vehicle."
So you may have to pay the trustee $500 to keep your car, assuming the trustee even wants it. That $500 is too slim a margin for the trustee to try and sell the vehicle.
As always, please consult with a local attorney. Click on "Find a Lawyer" above and locate an attorney in your area who handles bankruptcy. You may actually come to discover that your car is worth less than anticipated and is exempt, along with other exemptions you would not think of on your own.
You don't have a choice as to whether or not to include the listing of the vehicle or the debt owed on it in the Bankruptcy. You can't show preferential treatment to one Creditor over another; and, if you fail to list an asset like a car, when it is discovered your entire Bankruptcy discharge is in jeopardy. In essence, you will not get the benefit of a Bankruptcy discharge. Given your situation, it appears that you are being overly concerned when there is not much to be worried about. If your valuation of $5,000 is accurate: the Trustee is going to add your $3,000 automobile exemption (if properly claimed) to the $2,000 amount of debt, and quickly conclude there is no non-exempt equity to justify liquidation of the vehicle. Good Luck.
If your car is worth $5,000 and you owe $2,000, you should be able to keep your car in a Chapter 7 with the vehicle exemption. Be careful on where you get your valuation, however. Sometimes I will refer my clients to Erkelens & Olsen Auction Company for a more accurate valuation.
You are required to list all of your assets (including your car) and all of your debts (including your car loan). Whether you can keep your car depends on the details of your case and whether you can exempt the equity in it. Ask your attorney.
Robert W GambrellChapter 13 Bankruptcy AttorneyOxford, MS ·
You can exempt the equity in the auto if the equity is less than the amount allowed under Utah law, which appears to be $6,000.00. If your value and the secured loan payoff balance is accurate, you only need to use $3,000.00 of the exemption. However, you will be required to reaffirm the debt. If you are behind on your monthly payments on the note secured by the car, then the lender can require that you bring the payments current to reaffirm.
You have a second option, which is to redeem by paying off the loan in one lump sum.
You must list your car in the bankruptcy. You will lose your discharge if you don't. You will need to reaffirm the debt and properly claim an exemption for the car. If you do these two things, it is still possible to lose the car in a 7 if the trustee can get more than your allowed exemption from the car. You car would be safe in a 13. I would not handle this on your own if you want to keep the car.
