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How Bankruptcy Can Stop Repossession and Get You Back on Track
Are you worried about losing your car because you’re struggling with debt? You’re not alone. Car repossession can be a scary and stressful experience, but there’s hope. Our Georgia bankruptcy attorney could be your key to stopping car repossession and getting back on track financially.
When you can’t keep up with car payments, repossession might feel like it’s right around the corner. It’s a tough spot to be in, but don’t panic. There are ways to prevent repossession and keep your car parked in your driveway where it belongs.
Quick Summary:

• Car repossession occurs when a lender takes back a vehicle due to missed payments or other violations of the loan agreement.
• Cars get repossessed  if you can’t pay for it anymore. This can happen because of money problems, unexpected events, or not being able to afford the loan payments.
• Bankruptcy can stop car repossession by initiating an “automatic stay.” This prevents creditors from seizing the vehicle. It provides a chance to reorganize debts or liquidate assets under Chapter 7 or Chapter 13 bankruptcy

What is Car Repossession?
Car repossession happens when you can’t keep up with your car payments, and the lender takes your car away. It’s like when you borrow money to buy a car, but then you can’t pay it back on time. The lender has the right to take the car back because it’s the collateral for the loan.
When a car gets repossessed, it’s usually not a pleasant experience. The lender might send a repo agent to take the car from you, and they can do it without warning. They might even come to your house or your work to take the car back.
Why Do Cars Get Repossessed?
Understanding these common reasons for car repossession can help you stay on top of your finances. It also helps you avoid getting into a situation where your car is taken away. If you’re struggling to make your car payments, it’s important to communicate with your lender. This gives you an opportunity to explore your options to prevent repossession. Here are the most common reasons why cars get repossessed in the United States:
Missed Payments
One of the most common reasons for car repossession is missing payments. When you take out a loan to buy a car, you agree to make regular payments to the lender. If you miss one or more of these payments, the lender may decide to repossess your car.
Financial Hardship
Sometimes, unexpected financial difficulties can make it hard to keep up with car payments. This could be  from losing a job, facing medical bills, or other financial challenges. If you can’t afford to make your car payments, the lender may repossess your car.
Defaulting on the Loan
Defaulting on your car loan means that you haven’t met the terms of the loan agreement. This could happen if you consistently fail to make payments, or if you violate other terms of the loan agreement, like not having insurance on the car.
Change in Circumstances
Life can be unpredictable, and sometimes circumstances change. If you experience a major life event like a divorce, illness, or relocation, it can impact your ability to make car payments. In these cases, the lender may repossess your car if you can’t find a way to catch up on payments.
Stop Car Repossession Now: How Bankruptcy Can Help
If you’re worried that your car might get repossessed because you’re struggling with debt, there’s a way to get relief – it’s called bankruptcy. Bankruptcy is a legal process that can help you deal with overwhelming debt by giving you a fresh start. And one of the big benefits of bankruptcy is that it can put a stop to car repossession.
When you file for bankruptcy, something called an “automatic stay” goes into effect. This is like hitting the pause button on any collection actions, including car repossession. It means that your creditors can’t take any further action to repossess your car while the bankruptcy process is going on. This includes the company you owe money to for your car. 
There are different types of bankruptcy, but the two most common ones for individuals are Chapter 7 and Chapter 13.
Chapter 7
Chapter 7 bankruptcy is often called “liquidation” bankruptcy. It involves selling off your assets to pay your debts. But don’t worry – in many cases, you can keep your car even if you file for Chapter 7. There are exemptions in bankruptcy law that allow you to keep certain assets, including your car, up to a certain value.
Chapter 13
Chapter 13 bankruptcy is sometimes called “reorganization” bankruptcy. It involves creating a repayment plan to pay off your debts over time. With Chapter 13, you can often keep your car and catch up on missed payments through the repayment plan.
Facing Repossession? A Georgia Bankruptcy Attorney Can Hit the Brakes
Many people worry about their cars being taken away when they can’t pay their bills. But don’t worry, there’s help available. Our Georgia bankruptcy attorney can be your guide and protector during this tough time. Here’s how we can help:
Understanding Your Options
We can explain the different types of bankruptcy and how they might apply to your situation. We’ll help you figure out if bankruptcy is the right choice for you and which type would be most beneficial.
Negotiating with Creditors
We can negotiate with your creditors on your behalf to try and work out a deal to keep your car. We might be able to arrange a new payment plan or modify your loan terms to make it easier for you to keep up with payments.
Protecting Your Rights
We will make sure that your rights are protected throughout the process. We’ll help you understand what your rights are and make sure that creditors aren’t taking advantage of you.
Don’t let the fear of losing your car overwhelm you. With the help of our bankruptcy law firm, you can fight to stop car repossession. They’ll stand by your side, explain your options, and fight for your rights. 
Let Our Georgia Bankruptcy Lawyers Help Fight Back Against Car Repossession
Facing car repossession is a stressful situation, but filing for bankruptcy can be a powerful tool to stop it. With bankruptcy, you have options to keep your car, whether it’s Chapter 7 or Chapter 13. These options can give you time to figure things out and get back on track financially.
At Northwest Debt Relief Law Firm, our Georgia bankruptcy attorneys can guide you through the process and protect your car from being repossessed. Our bankruptcy law firm can help you file the necessary paperwork and make sure everything is done correctly and on time. We’ll also discuss other options you might have and help you decide what’s best for your situation.
Don’t wait until it’s too late to stop repossession. Contact us now for free debt solution consultations and let us help you protect your car and regain control of your financial future.

U.S. Seeks to Collect on Up to $20 Billion in Delinquent Covid LoansThe Wall Street Journal is reporting in an article dated March 7, 2024 that the U.S. is seeking to collect $20 Billion in  delinquent SBA EIDL Covid loans from small businesses and not for profit entities. The article can be found at https://www.wsj.com/business/u-s-seeks-to-collect-on-up-to-20-billion-in-delinquent-covid-loans-96dd36c6?mod=business_lead_storyThe SBA announced that  delinquent Covid EIDL loans with balances of $100,000 or less will be sent to the Treasury Department for collection.The referral is sent to Treasury Direct, which can seize government benefits such as portions of Social Security payments and tax refunds.Additionally, in our experience Treasury Direct can and will assess a 30% penalty on the unpaid balance of defaulted SBA EIDL loans (a point not covered in the article).Moreover, borrowers who default may have to recognize Cancellation of Debt income, which is ordinary income under section 108 of the Internal Revenue Code (another point not covered in the article).Many small businesses never intended to repay the loans, hoping they would be forgiven like PPP loans; however, this is not the case.Borrowers with questions about defaulted SBA EIDL loans should contact Jim Shenwick, Esq. Jim has an LLM in Taxation from NYU law school and he is familiar with the Cancellation of Debt tax issues. 
Jim Shenwick, Esq  917 363 3391  [email protected] Please click the link to schedule a telephone call with me.https://calendly.com/james-shenwick/15minWe held individuals & businesses with too much debt!---Jim Shenwick, Esq Blog SBA EIDL Posts:SBA EIDL Loan Charge Offshttps://shenwick.blogspot.com/2024/02/sba-eidl-loan-charge-offs.html
SBA EIDL LOANS & CIVIL & CRIMINAL PENALTIES & BANKRUPTCY FILINGShttps://shenwick.blogspot.com/2024/01/sba-eidl-loans-civil-criminal-pena...Defaulted SBA EIDL Loans: In Reversal, U.S. to Heighten Efforts to Collect Billions in Unpaid Covid Loanshttps://shenwick.blogspot.com/2023/12/defaulted-sba-eidl-loans-in-revers...
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Defaulted SBA EIDL Loans, Limited Liability Company (LLC) and Cancellation of Debt Income (COD) under Section 108 of the Internal Revenue Codehttps://shenwick.blogspot.com/2023/07/defaulted-sba-eidl-loans-limited.html
Offers In Compromise ("OIC") for Defaulted SBA EIDL loans and Section 108 of the Internal Revenue Code ("IRC"), Relief of Indebted Income, a Trap for the Unwary!https://shenwick.blogspot.com/2023/05/offers-in-compromise-oic-for-defau...EIDL LOAN WORKOUTS AND BANKRUPTCY    https://shenwick.blogspot.com/2022/07/eidl-loan-workouts-and-bankruptcy....
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Many clients who have defaulted on SBA loans receive a letter from the SBA indicating that their loan has been charged off. They ask us if this means the loan has been forgiven and does not need to be paid back.“Charging off” is an accounting concept that  allows the SBA to remove the loan from its books and records  as an asset, but the SBA can still try to collect the debt.Simply stated, charging off or charged off does not mean that a loan is forgiven!Even though the loan is charged off, the borrower still owes the money and the SBA can continue collection efforts.Collection methods include lawsuits, foreclosure on assets, garnishing wages, reporting the default to Treasury Direct (so that the Government can seize tax refunds) and reporting the default to credit bureaus. So in summary, a charge off is an accounting procedure but does not relieve the borrower of repayment responsibility. The SBA treats the charge off as a default and it will pursue further collection even after charge off.Clients or their advisors with questions about defaulted SBA loans should contact Jim Shenwick, Esq.  917 363 3391  [email protected]Jim Shenwick, Esq  917 363 3391  [email protected] Please click the link to schedule a telephone call with me.https://calendly.com/james-shenwick/15minWe held individuals & businesses with too much debt!

The debanked website is reporting that Covid SBA EIDL loan charge offs increased by $52 Billion in 2023.   Those charge offs equal 17.2% of the unpaid principal balance of SBA outstanding EIDL loans. The story can be found at https://debanked.com/2024/02/covid-eidl-charge-offs-explode-increase-by-more-than-51-billion-in-fy-2023/This report is unsurprising, as a rough estimate indicates that 75 to 80% of our clients have defaulted or are considering defaulting on their SBA EIDL loans.SBA EIDL loan defaults raise Debtor/Creditor, Bankruptcy, Tax and Personal guaranty issues. SBA EIDL loan defaults are also reported to Treasury Direct (IRS) and a 30% penalty is added to the balance due.The worst action a borrower in default on an SBA loan can take is to ignore the situation.As one famous lawyer said, prayer is not a legal strategy!At Shenwick & Associates, we have developed techniques & strategies to minimize tax and debtor/creditor issues involving an SBA EIDL default.To speak to Jim Shenwick, Esq about an SBA EIDL loan default you can call him at 917-363-3391 or email him at [email protected]Please click the link to schedule a telephone call with Jimhttps://calendly.com/james-shenwick/15min---James Shenwick, Esq SBA EIDL Blog Posts:SBA EIDL LOANS & CIVIL & CRIMINAL PENALTIES & BANKRUPTCY FILINGShttps://shenwick.blogspot.com/2024/01/sba-eidl-loans-civil-criminal-penalties.htmlDefaulted SBA EIDL Loans: In Reversal, U.S. to Heighten Efforts to Collect Billions in Unpaid Covid Loanshttps://shenwick.blogspot.com/2023/12/defaulted-sba-eidl-loans-in-reversal-us.html
SBA EIDL Loan Defaults and the Statute of Limitations 12-24-2023https://shenwick.blogspot.com/2023/12/sba-eidl-loan-defaults-and-statute-of.html
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Defaulted SBA EIDL Loans, Limited Liability Company (LLC) and Cancellation of Debt Income (COD) under Section 108 of the Internal Revenue Codehttps://shenwick.blogspot.com/2023/07/defaulted-sba-eidl-loans-limited.html
Offers In Compromise ("OIC") for Defaulted SBA EIDL loans and Section 108 of the Internal Revenue Code ("IRC"), Relief of Indebted Income, a Trap for the Unwary!https://shenwick.blogspot.com/2023/05/offers-in-compromise-oic-for-defaulted.html
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EIDL Loan Default Questions & Answers https://shenwick.blogspot.com/2022/10/eidl-loan-default-questions-answers.html
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EIDL Defaulted Loanshttps://shenwick.blogspot.com/2022/07/eidl-defaulted-loans.html
New Relief Program for SBA EIDL Borrowers Who are Having Difficulty Repaying EIDL Loans " Hardship Accommodation Plan"https://shenwick.blogspot.com/2023/05/new-relief-program-for-sba-eidl.htmlEIDL LOANS and SBA OFFER IN COMPROMISE PROGRAMhttps://shenwick.blogspot.com/2022/07/eidl-loans-and-sba-offer-in-compromise.htmlPPP & EIDL Fraudhttps://shenwick.blogspot.com/2022/08/ppp-eidl-fraud.html