Will I be able to keep my car after filing for Chapter 7 Bankruptcy?

In South Dakota, you may be able to keep your car after filing for Chapter 7 Bankruptcy. If your car is worth less than the loan amount you owe on it, you may be able to keep it if you can protect it with your state’s exemption laws. Without protection, the bankruptcy trustee would be able to sell it to help pay off your creditors. South Dakota has fairly generous exemptions that allow you to keep up to $6,500 in equity in your car, as long as it is not a luxury item. However, if the equity in your car exceeds $6,500, you may be able to pay the difference and keep the car if you can afford to do so. You will need to be current on your loan payments to keep the vehicle. If you are behind on payments, you may be able to enter into a reaffirmation agreement with the lender, agreeing to resume making payments on the loan and providing the lender with additional security against the loan. Another option is to redeem your car, which means you pay the lender the current value of the car, as determined by a third-party appraisal. The amount you pay is usually lower than the amount you owe, so you may be able to save money this way. No matter which option you choose, you should speak to an experienced bankruptcy attorney to find out your best option for keeping your car.

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Will I be able to keep my car after filing for Chapter 7 Bankruptcy?

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