JILL ASKED: I have a lease-to-own vehicle and I’m a year+ into a 5-year lease. I need my car for work. If I claim bankruptcy, can I keep the car?
ANSWER: The simple answer to your question is, yes. You can keep your leased vehicle after filing personal bankruptcy as long as you continue to make your payments. Here is a more detailed explanation.
There are two types of creditors: ‘secured’ and ‘unsecured’.
‘Secured creditors’ – those that hold assets as collateral for their loans (like your car lease)
‘Unsecured creditors’ – those who do not have any collateral/security for their loans (credit cards)
If you file personal bankruptcy you are dealing with your unsecured creditors, but filing personal bankruptcy does not affect the rights of secured creditors.
Even after filing personal bankruptcy, secured creditors (car lease):
Have a right to be paid, or, if you decide to stop paying them.
You have to be willing to surrender/give back their security/asset (the car).
Provided that you can afford to maintain the car payments – filing personal bankruptcy will not affect your ability to keep your leased vehicle.
We have offices across South Western Ontario and consultations are FREE. We also have flexible hours to meet your needs so you don’t have to miss work.
Let us help you get a fresh financial start today!