REDEMPTION; HOW WORKERS COMP RESETS YOUR LIFE

When you file a bankruptcy case, you are required to value all of your vehicles. When your vehicle is worth less that what you owe on it, it is possible to do a redemption. Redeeming the loan is when you get the court to assist you in forcing the lender to accept the current fair market value of the vehicle as payment in full on the loan you owe. For example, if you have a vehicle worth $6,000 and you owe $10,000 on your loan, a redemption would allow you to pay $6,000 up front to the lender, and the court would discharge the remaining $4,000 you owe in the bankruptcy.

The main pro of redemption is that you can save a LOT of money because you are only paying the amount that your vehicle is actually worth.

The down side is that most clients do not usually have a large amount of cash to pay up front, and redemptions do not permit payment plans. Most clients get a redemption loan - this is a hard money loan from a new lender, often at a very high interest rate. It is important to make sure that the redemption loan is affordable, because that new loan will not be included in the
bankruptcy. A good bankruptcy attorney can help you negotiate a redemption loan that can save you thousands of dollars and decrease your monthly vehicle payment - plus, you get to keep the vehicle!

You may have a relative who will loan you the money or even buy the vehicle and sell it back to you.

Redemptions require you and your attorney to attend a special court appearance where you must prove the fair market value of the vehicle you are redeeming. Often your lender will contest the value we list, so having attorney representation is very important.

To learn more about redemption or to set up a free consultation with our bay area bankruptcy attorney, please call.

Read more: http://www.articlesbase.com/bankruptcy-articles/redemption-how-bankruptcy-can-dramatically-reduce-your-monthly-vehicle-payment-2663844.html#ixzz0rW9xjib0
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