A vehicle lease is legally different from a vehicle loan in many ways. In the end it can be more expensive. Escape a lease with bankruptcy. The Temptation of a Vehicle Lease Leasing can seem like a sensible way to get a new vehicle. You often pay less money down and pay lower monthly payments. So leasing can sometimes … Read More
When you’re facing a vehicle repossession, a Chapter 7 case prevents that and gives you a few weeks of peace to get another vehicle. A week ago we went through a list of ways Chapter 7 buys you time with your vehicle lender. Included was that it “gains you some time to get another vehicle before surrendering your present … Read More
Although Chapter 7 can work fine if you’re current on your lease, use Chapter 13 instead if you’re behind and need time to catch up.
You can most likely “assume” your vehicle lease and keep that vehicle under Chapter 7. But you need to be current or able to be quickly.
If current or able to get current on your vehicle lease payments, you’ll likely be able to keep that vehicle in a Chapter 7 case.
Keeping a vehicle and its debt is sometimes not the best option. Chapter 7 and Chapter 13 can both give you a safe way out.
In so many often surprising ways, bankruptcy can fix your earlier mistakes, undo harms caused by creditors, and clear a better path forward.
If you are not current on your leased vehicle but want to keep it, file a Chapter 13 case if you can’t bring the account current right away.
If you are current on our leased vehicle, you can likely keep it in a Chapter 7 “straight bankruptcy.” If not current, you need Chapter 13.
Chapter 7 gets you out of a vehicle lease quite cleanly. But if you have to file a Chapter 13 case for other reasons that can work, too.
A vehicle lease can cost you less up front and monthly, but in fact is often the most expensive option. Bankruptcy is your escape clause.