Can I file bankruptcy with a leased car?

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Can I file bankruptcy with a leased car?

Can I file bankruptcy with a leased car? Yes, you can file bankruptcy with a leased car in Utah but if you are hoping to retain the vehicle, there are special requirements that your attorney will need to follow in order for you to keep the car. You can keep a vehicle in Chapter 7 Bankruptcy or Chapter 13 Bankruptcy.

First of all, you must still be able to make the payments you agreed to when you began the lease (in legal terms this is called “assuming the lease”), so that means you still have to be able to make the usual monthly payments and comply with any other terms and conditions set out in the lease document. It is important that you provide your bankruptcy attorney with a copy of the lease agreement especially if you are trying to keep the lease.

If you prefer not to keep the car, then you would be “rejecting the lease” and the vehicle would be returned to the lease holder usually at the place you leased it. This decision of whether to assume or reject the lease must be made within the 60 day period from the day you filed for bankruptcy.

Its very important to talk your to your attorney about bankruptcy with a leased car. Sometimes it is not in your best interest to keep the vehicle and once you know your options you can then make an informed decision.

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