Life isn’t always easy. There’s a lot of day-to-day-baggage to cope with and sometimes things happen that you wish didn’t.
Whether you are in a position of debt or anxious you soon will be, the team at MoneyPlus are here to support.
If you have debts that will take a long time to pay off and your financial situation is unlikely to improve any time soon, filing for bankruptcy might be a course of action you’re forced to take. It’s a legal procedure that can be used to write off most debts.
If you do decide to declare yourself bankrupt it can affect your life in many ways. Although it writes off most of your debts, it can affect other aspects such as your home, job, business and pension.
Your credit rating will also be affected and because of this you may find it difficult to get any further credit for up to six years.
If it’s a situation you’re currently facing or considering, there will be many questions going around in your head. One of these might be: If I file for bankruptcy can I keep my car?
There may be reasons why claiming bankruptcy but keeping your car are vitally important. If so, you are not alone.
Being able to keep your car through bankruptcy is a must for most people to enable them to carry on working.
The ownership of your vehicle will undoubtedly be affected by bankruptcy, whether you own it outright or are paying for it through a financial package.
How you and your car will be affected may depend on how an official receiver or finance company views your individual case.
The following general guidance might help answer some questions you have about whether you can file for bankruptcy and keep your car:
You own your car
If you own your vehicle outright, you may not be able to keep your car if you declare yourself bankrupt. The official receiver will only let you hang on to it if it’s essential and of low value. A vehicle may be classed as essential if you can’t get to work or do your job without it or you, or someone in your family has a disability and relies on it.
If there’s any way you can use public transport, no matter how inconvenient this would make life for you, the official receiver will not regard your car as essential.
You pay for your car on hire purchase or conditional sale
Vehicles paid for using hire purchase or conditional sale do not belong to you until the last payment is made. So, if you declare yourself bankrupt, you may be able to keep your car if you can continue to meet the payments and if keeping it is essential to you.
The hire purchase or conditional sale agreement may include a clause ending your agreement if you go bankrupt and the lender could repossess and sell it. However, there are lenders who may allow you to keep your car if you file for bankruptcy if you carry on making the repayments.
If you have a logbook loan
If you’ve borrowed money using your car as security, you may be able to keep your vehicle if you file for bankruptcy if you continue to pay off the loan. The official receiver will check how the logbook loan has been agreed. Once again, the lender may have a clause ending the agreement if you go bankrupt.
If your car is part of a Motability Scheme
A Motability vehicle paid for using attendance allowance, disability living allowance (DLA) or personal independence payment (PIP) is a lease agreement. This means the car does not belong to you and the official receiver cannot sell it.
At MoneyPlus we remove the jargon and confusion, enabling our customers to turn run-away moments into manageable ways forward. Let’s face it, whatever you’re going through, chances are we’ll have seen it before.
Our philosophy is to focus on the future, not on the past. Whatever has made our paths cross has happened. We’re here to support and, together, we’ll find a solution. Get in touch today to find out how we can help.