FILL OUT THE FORM BELOW AND RECEIVE A NO-OBLIGATION CONSULTATION

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lose the car

i am bankrupt and now my spouse may have to also declare, we have been told by at least 3 people that if you have a child under 16 you cannot lose your car. we have a loan on our car and 3 kids, is it true the car is exempt even with the car being collateral for part of the loan?

Posted from: British Columbia

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One Response to “lose the car”

Barton Goth – Goth & Company Inc. -Trustee in Bankruptcy said...

I am not sure who you have been speaking to, but I would recommend you contact a local trustee as the information you are being given isn’t correct.

The vehicle exemption is not based on the number of children. What they look at is the equity in your vehicle.
You are permitted to keep a motor vehicle with equity of up to a value of $5,000. This changes if you are a debtor under the Family Maintenance Enforcement Act, then value is reduced to $2,000.

The other part of this is the secured loan. The secured loan has to be paid as it is not affected by the bankruptcy. So for you to keep the vehicle you have to have less than $5,000 and continue to make the payments to your secured creditor.