A New Jersey bankruptcy filing requires the auto finance company to turnover possession of a repossessed vehicle to the debtor (person filing bankruptcy), under certain circumstances.
If the repossessed auto is not sold by the finance company at the time of the bankruptcy filing, the company is required to turnover the vehicle to the debtor. This means that if the auto was transported to another state for auction, the vehicle must be returned after the filing.
However, prior to returning the vehicle, the finance company will require proof of adequate auto insurance coverage that includes the company as the lien holder or loss payee. The required insurance covers the company in the event of damage or loss.
Additionally, as a condition of obtaining possession of the repossessed vehicle, the debtor must have filed a chapter 13 bankruptcy case, and not a chapter 7, which provides for payment of the arrears through a bankruptcy plan over 36 to 60 months. Please note that, although unusual, under certain circumstances, it may be possible to obtain possession of a vehicle in a chapter 7, if the debtor has the ability to redeem the vehicle or pay to the company the total value of the auto.
If you wish to obtain possession of an auto that has been repossessed – and want to speak with a New Jersey Bankruptcy Attorney with almost two decades of experience- give my office a call at 866-503-5455.