Repossession

Whenever you purchase a high-ticket item, such as a car or home, the creditor for this transaction retains several very important rights with regards to the property. If you fail to meet your payment deadlines, then this individual has the right to repossess, or take back, the purchased item. Repossession is most commonly applied in automobile purchases.

Avoiding Repossession

There are several ways for consumers to avoid repossession of their purchases. One way is to set up a payment plan that is viable for your financial situation, so that you meet all your payment deadlines. It is extremely important for you to read the contract before signing it; many times, debtors are not given a whole lot of flexibility with these agreements. In some cases, creditors will not allow extensions on payments, so if you miss even one you may be at risk of losing your purchase.

Another way to avoid repossession is to file for bankruptcy. Filing bankruptcy stops the process of repossessing your purchase (we’ll assume it was a vehicle). Depending on which type of bankruptcy you file, you may or may not keep your vehicle. In general, filing Chapter 13 always allows you to keep the car or truck. Under Chapter 7, however, you must pay off all missed payments before the court will allow you to keep the vehicle. Failure or inability to do so will result in the lifting of your automatic stay, and the repossession will resume.

Contact Us

If you would like to learn more about repossession or are thinking about filing for bankruptcy, contact the Austin bankruptcy lawyers of Slater, Kennon & Pugh Ltd.LLP today at 512-338-1100.