For many North Carolina residents, their car is a necessary item that allows them to go to work or attend school. However, some people may face serious financial difficulties that prevent them from paying off their car loans. As a result, they may face the threat of repossession. People can contact their lenders and attempt to negotiate a solution, including changing the payment date, deferring the loan, or modifying the terms.
However, if negotiations with the lender are unsuccessful, there are other ways that people can work to keep their cars. Many people who are facing an auto repossession are also being crushed by personal debt in other areas of their life, such as credit card bills. For these people, filing for personal bankruptcy may be an option to seek debt relief. The two most common types of personal bankruptcy, Chapter 7 and Chapter 13. Once a person files for bankruptcy, an automatic stay is placed on collection efforts, including auto repossession.
Of course, the stay only lasts during the bankruptcy period. However, under a Chapter 13 bankruptcy, this time may allow people to make some changes and pursue a different course of action. People could find another transportation option and surrender their car. Alternately, they could pay their regular loan payments and include the overdue amount as part of their Chapter 13 repayment plan.
Loans that are in default are often accompanied by creditor harassment. People who cannot pay their bills can consult with a bankruptcy lawyer about the options that may be available for debt relief.