Will filing for bankruptcy stop repossession?

Filing for bankruptcy can help stop a repossession in some cases. When an individual files for bankruptcy in Colorado, an automatic stay is put in place that prevents creditors from continuing with collection efforts, such as repossessions. This stay remains in place until the individual’s bankruptcy is resolved and the court orders the lender to end the stay. However, filing for bankruptcy does not always guarantee a repossession will be stopped. The lender might be allowed to begin the repossession process if the individual has neglected to keep up with payments, or if the lender can show the court that the individual does not have the means to repay the debt. The lender must present evidence that the stay should be lifted before the repossession can proceed. The best way for individuals to stop a repossession when filing for bankruptcy is to contact their lender to negotiate a payment plan. In some cases, a payment plan can be worked out that will allow the individual to keep their car or other property. It is also important for individuals to stay on top of all post-bankruptcy payments, as this can help ensure the court does not lift the stay and allow the lender to resume repossession.

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Will filing for bankruptcy stop repossession?

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