When you file for Chapter 7 bankruptcy, you might have to give up certain property and assets in exchange for the discharge of your debts. Many of us rely on our personal cars to get us to work, take kids to school, and get to other obligations and activities. Losing a car in a bankruptcy case can cause many problems in our lives, and may even put our jobs in jeopardy. For this reason, it is no surprise that a very common question is whether you can keep your car in a Chapter 7 bankruptcy case.
The good news is that many people are able to keep their cars in bankruptcy, though the legalities of doing so can be complicated. You should always discuss the matter with an experienced bankruptcy lawyer in Memphis who can advise you of your options.
Tennessee Bankruptcy Exemptions
Chapter 7 filers can apply exemptions provided by Tennessee state law to protect as much property as possible. While Tennessee is one of the few states that does not provide a specific vehicle exemption, though there are other options. For example, you can exempt up to $10,000 in miscellaneous personal property, which includes personal vehicles. This applies to the equity you own in your vehicle – for example:
- You financed a car for $25,000
- You have paid off $8,000 of the car, giving you that much equity
- The $10,000 personal property exemption will cover the equity, and you can keep your vehicle
You can reaffirm the remainder of the car loan, which will allow you to keep making payments and retain ownership.
Contact a Bankruptcy Lawyer in Memphis Today
Every situation is different, and a Memphis bankruptcy attorney at Hurst Law Firm, P.A., will do everything we can to help you keep your property. Call 901.725.1000 or contact us online to discuss a possible case today.