Can I keep my car when filing for bankruptcy?

Yes, you can keep your car when filing for bankruptcy in Washington. When you file for bankruptcy, a court-appointed trustee will review all of your assets to determine which are exempt from the bankruptcy. In Washington, the state allows for $3,250 in equity for each vehicle owned. Equity is the value of your vehicle minus any loans or liens on that vehicle. For example, if you own a car worth $15,000, but you still owe $10,000 on the loan, then your equity is valued at $5,000. You would be allowed to keep that car in bankruptcy, as $5,000 is below the $3,250 threshold. However, the court-appointed trustee may still take possession of the car if they determine that it would be of greater benefit to your creditors to liquidate the vehicle. This means they would sell the car, pay off the remaining loan, and use the money leftover to pay your creditors. This is rare, however, and usually only happens if the value of the car is greater than the amount of the loan. Additionally, if you do get to keep your car in bankruptcy, you are still responsible for making payments on the loan if you wish to keep the car. The loan company is still allowed to proceed with repossession of the vehicle if you fail to make your payments. In summary, you can keep your car in bankruptcy in Washington as long as the equity in your vehicle is valued at less than $3,250. However, the court-appointed trustee has the ability to liquidate the car if it is of greater benefit to your creditors. Additionally, you are still required to make payments on the loan if you wish to keep the car.

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Can I keep my car when filing for bankruptcy?

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