If i file bankruptry and i have a truck that is payed off can my creditors take it

Asked over 4 years ago - Bridgeport, PA

i need to file bankruptry because I lost my job three yrs ago and have been current on all my bills but I;m not able to do so any more and i have a truck thats payed off can my creditors take it

Attorney answers (3)

  1. David J. Harris

    Contributor Level 8

    Answered . The answer to your question will depend on:

    (A) the value of your truck,

    (B) the exemptions that are available to protect your truck, and

    (C) the chapter under which you file your bankruptcy case.

    Here in Pennsylvania (I'm in Wilkes-Barre), you can elect to use the Bankruptcy/Federal vehicle exemption of slightly more than $3,200.00 and, if you do not elect to use a real estate exemption because you do not own your residence or have no equity in your residence, you can also use the Bankruptcy/Federal "wild card" exemption of slightly in excess of $11,000.00 to protect the truck.

    If you own the truck jointly with your spouse and your unsecured debts are just yours and not joint debts of you and your spouse, you can getting greater protection by using the Pennsylvania tenancy by the entireties exemption, but you cannot use both the Bankruptcy/Federal exemption set and the Pennsylvania set. It's one or the other.

    If neither exemption set is sufficient to protect your truck, you can file a chapter 13 case and simply pay an amount equal to the non-exempt equity in your truck to a chapter 13 trustee, spread out over a period of 5 years!!! your truck will be protect and your unsecured debts will be gone when you conclude your case.

  2. Glenn A Brown

    Contributor Level 10

    Answered . As they say its complicated. You need a bankruptcy attorney consultation so that we can help you with a plan of action.

  3. Mark J Tanney

    Contributor Level 9

    Answered . You asked your question under the category of Chapter 13, so I assume you are planning to file under that chapter. In Chapter 13 you ordinarily keep all your property. A chapter 13 bankruptcy is sometimes described as a “wage earner’s plan.” If you have a regular income chapter 13 gives you the opportunity to create a plan to repay all or part of your debts over a period of time. A chapter 13 plan is something like a debt management plan, but it is one that your creditors are forced to accept. As long as you meet all your obligations under the plan, creditors are not allowed to take any collection actions against you.

    However, based on your question, it sounds like you might still be in the process of looking for that "regular income." If that is true, then you may end up filing your bankruptcy under Chapter 7. To obtain a Chapter 7 discharge the law requires that you give up your property so that it can be liquidated (sold and turned into cash) for the benefit of your creditors. However, much of your property is “exempt” property that the law allows you to keep. In fact, in many cases, all of your property will be exempt. Still, you should keep in mind that if you have substantial, valuable property and you are filing for Chapter 7, you may need to turn over some of that property to the Chapter 7 trustee to be sold for the benefit of creditors.

    Even though bankruptcy is a federal law, exemptions are determined by each individual state. In order to determine what exemptions apply in Pennsylvania, and whether your truck can be exempted, you will need to consult a Pennsylvania bankruptcy lawyer. If you cannot afford a lawyer you should do your best to consult a lawyer through free legal services of some kind. It's possible to file bankruptcy on your own, but it's much better to try and get some legal advice. Small mistakes can be very costly.

    I don't have all the facts for your particular situation, so you should not rely on what I say as legal advice. It is mainly for information purposes. You should speak to a Pennsylvania bankruptcy lawyer. But I can say this much: I think you have a very good chance of finding a way to keep your truck.

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