I am thinking about filing a Chapter 7. If I am behind on my car payments, will this save my car?

A Chapter 7 bankruptcy will not save your car from being repossessed if you’re behind on payments and if you have not worked out a payment plan with the lender. Before chapter 7 bankruptcy forms is filed, the car can be legally repossessed. However, if the vehicle is not repossessed before the bankruptcy is filed, and after bankruptcy filings are completed, an automatic stay goes into effect which prevents creditors, including your vehicle lender, from contacting you or repossessing the vehicle.

Nevertheless, a vehicle lender can lift an automatic stay by going to court shortly after the bankruptcy is filed. This is done regularly, and after the stay is lifted, your vehicle will be repossessed. If you’re able to pay the lender back for the missed payments before your vehicle is repossessed and/or the stay is lifted, you will be able to keep the vehicle (as long as the bankruptcy Trustee and lender allow the reaffirmation).