Is this worth filing?

[Rozi]

Hi Everyone!

I have a question... I am 39K in debt. 25K of it is a car that I am about 30 days late on. The rest is credit card and a loan from my credit union. I filed Chapter 7 in 2001 and it looks like I might need to file again. Is it worth filing again or should I just send the car back and try and pay down my debt? My car note is 600 a month and that is the bulk of the debt. I have 3 more years to pay on this car. I love the advice that has been given on this board!

[keepinitreal]

How much is the car worth? If you send the car back and they auction it off, could you afford to make payments on the new balance you'll owe? Is the car loan with the same credit union you have another loan with? If so, you may have cross-collateralization issues.

Talk to lawyers at free consultations and see what they recommend.

[Rozi]

Thanks for your response! The retail value of the car is 14K and it's financed thru Citifinancial Auto. My loan is thru my credit union. Paying that after balance of the car after they auction it probably won't be possible.

[keepinitreal]

So it sounds like you would owe $25k unsecured if you voluntarily returned your car. Some people might say that's not enough, but everybody's situation is unique. We filed for slightly more than that.

Contact a lawyer for a free consultation. The Chapter 7 rules have changed since 2001 when you filed previously. The cost of the attorney and the filing fees are higher too.

Good luck with whatever you decide!