Salute, good morning. Beautiful to see you on this page
Have You Bought Cars And Incurred Debt? What Are The Consequences In Bankruptcy?
With many people losing their jobs at the moment that are going to be a lot of cars debt problems, where people cannot afford the repayments on their cars. What should you do if you are in this situation (especially if you are considering bankruptcy)?
Cars Debt - What Type of Debt?
When cars are purchased they will usually be financed either with a loan secured against the value of the car (motor finance) or by a personal loan. This article is concerned only with cars financed with a motor finance loan secured against the car.
Cars Debt - What Should You Do?
If you are having trouble making the payments on your car loan then there may be things that you can do. Investigate whether it is possible to re-finance the loan over a longer period - this could cut the payments quite significantly.
If you are unable to meet the payments and can't refinance then you need to speak to the loan company urgently. Unless you can agree a payment holiday with them they will take the car back. Negotiate with them to get the best terms that you can - if you volunteer to give the car back you will probably end up owing less than if the loan company have to threaten you with bailiffs.
Shortfall Debt and Bankruptcy
If your car is taken back by the loan company and the amount that they raise from selling it is less than the value of the loan you will be left with a shortfall debt. This is just like any other personal debt (credit card, personal loan) and the loan company can and will come after you for it. If you are considering bankruptcy then it is important to realize that a secured motor finance loan will not be included in the bankruptcy but a shortfall debt would be. Therefore if you think that you are going to declare bankruptcy it is important to hand the car back and get the shortfall debt established before you declare bankruptcy. If you don't, you could end up with a debt that is not included in your bankruptcy. By: Neil D Robertson Article Directory : http://www.articledashboard.com If you want more free information then visit Neil Robertson's site, Debt Advice Free This site provides debt advice and information from someone that has been in a debt crisis situation and is now debt free. Find out about how you can reduce or eliminate debt fees