Many Kentucky residents who file for a chapter 13 bankruptcy worry that they will not be able to keep their assets. Luckily, this isn’t true. There are many opportunities for a debtor to keep their assets - such as their car - by way of reaffirming a car loan or cramming down the note.
Cramming Down in Kentucky Bankruptcy
If you are interested in keeping your car instead of applying for a bankruptcy car loan after you’re discharged then you can cram down your current loan. This means the court will order the creditor to lower the loan balance to the fair market value of the vehicle determined by a number of factors including the age, mileage, condition, and resale value.
While this can be a big advantage to those who qualify not all debtors will. If you have not owned your car for 910 days (2.5 years) before filing for chapter 13 bankruptcy you are ineligible to participate in the cram down process. Fortunately, that doesn’t mean you have to be without a car for long.
Kentucky Auto Financing Following Bankruptcy
Years ago it seemed almost impossible to get a new car note before the bankruptcy fell off your credit history, but luckily, times have changed. Although not all dealerships are equipped to help bankruptcy clients, many are.
Here at Bankruptcy Auto Financing we have a network of Kentucky subprime lenders that can help you get into an affordable car loan following bankruptcy. The Kentucky lenders we work with have all the tools and experience to give you the best chance at an auto loan approval. Apply online today using our fast and secure application.
Remember, we are not lawyers and cannot give legal advice. The situations discussed are only our experiences over the years and may vary with each customer.