In a Chapter 7 bankruptcy case, you can lose your vehicle if you have more equity than you can exempt. However, in a Chapter 13 bankruptcy, you can still keep your vehicle even though it is over-exempt. It just means that you will have to pay that extra amount that is over-exempt to your unsecured creditors.

Will full coverage cover a totaled car if its my fault?

If your car is totaled after colliding with a vehicle, tree, guardrail, or any other object, collision coverage pays for the value of the damaged vehicle, regardless of fault and minus any deductible.

What can I do if my car is totaled in a chapter 13?

If you total your vehicle while your Chapter 13 is open, you may be able to modify your bankruptcy plan so that you surrender your totaled vehicle to the bank rather than continue to make payments on the vehicle. However, bankruptcy courts often will not allow you to modify your plan once it has been confirmed by the court.

What happens if my vehicle is deemed a total loss while in bankruptcy?

The Motion to Modify Plan requests your Chapter 13 bankruptcy plan be reduced for what has been paid to the finance company for your totaled vehicle. It may also request that your Chapter 13 plan payments be reduced so you can afford a replacement vehicle.

Is there Chapter 13 bankruptcy in North Carolina?

This blog will discuss only Chapter 13 bankruptcy cases. These are guidelines specific to the Middle and Western Districts of North Carolina, so you should speak with your bankruptcy attorney regarding any nuances to your bankruptcy court’s procedure.

Can a bankruptcy court modify a car plan?

However, bankruptcy courts often will not allow you to modify your plan once it has been confirmed by the court. Your attorney can tell you whether the bankruptcy court is likely to accept such a modification.