Leased Vehicles in a St. Louis Bankruptcy
When you come into possession of a vehicle, it is usually done in one of three ways: you can either finance the car (with a loan), you can purchase the car outright, or you can lease the vehicle. In the latter example, you make regular monthly payments to a lending institution (just as if it were a financed loan). But you would not actually own the vehicle (although many leasing agreements do allow for the option to buy at the end of the lease term). This fact does make a substantial difference when it comes to filing a Missouri or Illinois bankruptcy.
When you file a bankruptcy in the state of Missouri (or Illinois), the court requires that you disclose a number of things. This would include information about any real property (like your home, rental houses, undeveloped land, or time share), any personal property (like bank accounts, appliances, furniture, and stock options), and any contract to which you have an obligation (like an apartment contract or a car lease agreement). Once these disclosures are made, the court allows your St. Louis bankruptcy lawyer to apply any governmental exemptions to the property in question (so as to cover any equity that may exist, and prevent the asset from being liquidated).
If you wish to maintain the lease with the lending institution (and keep the car or truck), it is permissible to do so. In a St. Louis Chapter 7 bankruptcy, you would simply reaffirm the lease and continue making the regular monthly payments. In a St. Louis Chapter 13 bankruptcy, the regular amount you pay each month to the lending institution would become a part of your Chapter 13 repayment plan. Instead of making a separate payment on the lease, the Trustee would pay the lending institution out this plan payment.
Of course, if you wish to surrender the leased vehicle, that is an option as well. Doing so would allow you to get out from underneath the debt completely. The affordable St. Louis bankruptcy attorneys at The Law Office of Jennifer Alter-Rieken have been helping people make it through the bankruptcy process from start to finish for years. Our goal is to make sure you are put on the road towards financial freedom, and receive the fresh start / clean slate that you deserve.