1. Tell The Truth:  This has been covered before but I think its incredibly important to cover again.  Do not, in any way, fail to reveal information to your attorney and to the court.  That means more than fibbing about how much your car is worth (which one could easily find out anyway).  It means not transferring property to friends or loved ones a month or two before filing for Bankruptcy.  It means answering honestly when the Chapter 7 Bankruptcy Trustee in New York City asks you questions about your property/income/assets, etc.  You can almost always negotiate a settlement if you have non-exempt property in a Chapter 7 Bankruptcy in New York.  You CANNOT do that after lying on the record.  Its criminal and I know I sound like your mother but it is so important that your realize how much this can hurt you.  There are ALWAYS options available to you with respect to your property.  But your Chapter 7 lawyer can’t help you if you dont tell him/her the truth.
2. Be Prepared for the Meeting of the Creditors:  Each one of my clients has a conversation with me before the meeting of the creditors because it is so critically important that they be prepared for the questions the Trustee will likely ask.  Look, no one wants to file for Bankruptcy in front of people, especially in New York City.  You can be nervous, you can feel ashamed, you could have eaten something not agreeable before the meeting (that hurts everyone in the room when it happens).  In any case, before you file for Bankruptcy in New York City, make sure to ask your prospective Manhattan or Brooklyn Bankruptcy Lawyer if they will prepare you for the “341 meeting.”  Questions arise like : “Have you ever owned Real Estate”  ”Are you going to be inheriting under a will”  ”What’s the most you’ve had in a checking account in the past two years.”  You clearly have to answer them truthfully, but there is also a particular way they should be answered, especially if your answer is vague,  and thats what an attorney’s job is.

3.     Do not be combative with the Chapter 7 Trustee in Brooklyn.  I can’t tell you how ridiculous this is.  The person             that can potentially wipe out hundreds of thousands of dollars in debt is sitting two feet in front of you and          you’re going to give him an attitude.  Folks, I get it.  I’m not a regular attorney.  I know what its like to try and contain my emotions when I feel like I am being pushed.  If you can get by the 5 minutes of questioning then you’re golden.  You’ll be be able to wipe out tens if not hundreds of thousands of dollars off your books and sleep well again.  I know its tempting, but make sure to treat each person in that room with respect.  It will pay off.

So lets attack this : What happens to my car if I file for a Chapter 7 Bankruptcy in New York?

Well, your favorite Bay Ride Bankruptcy Lawyer says a few things can happen.

• If you lease your vehicle in New York and you file for Bankruptcy, nothing happens.  You either get to keep the vehicle and re-affirm it (unless its a new Mercedez Benz, which can indicate bad faith), or you can give it back and you’re no long responsible for the vehicle and its deficiency.
• If you own a vehicle and file a Chapter 7 in Brooklyn or Manhattan:  This depends on whether there is significant equity in your vehicle.  If there is no equity in your vehicle, and typically there is not since you’ve likely made a small down payment on the vehicle, your vehicle will depreciate quicker than you’re paying off your note on your vehicle.  In English, your car is worth less than whats owed on it.  Great, keep the car if you want or give it back.  Choice is yours.
• If you own a vehicle in Brooklyn or Manhattan (you’re crazy-the paring garage’s will take your first born its so expensive) and you have significant equity in the vehicle before you file for a Chapter 7 Bankruptcy in Brooklyn or Manhattan, you will have a choice.  You need to know, from your trusty Bay Ridge Bankruptcy Lawyer, that you can exempt up to $2400 of equity in the vehicle, or $4800 if you file jointly (romantic), which will be yours if and when your car is sold.  That means if your car in Bay Ridge, Park Slope, or Williamsburg is worth $10,000, technically the Bankruptcy Trustee in Brooklyn can only get their hands on $7600 of that equity if they sold the vehicle.  The remaining $2400 is yours.  But be forewarned that if you own your car outright OR have significant equity, the Trustee will likely sell your car and pay off creditors with the money (and give you $2400 or $4800.)
• You can also negotiate to purchase your car in a Brooklyn Bankruptcy…from yourself.  Lets say that car is worth $10,000, and you have your $2400 exemption, the Trustee is still going to have to pay expenses to sell your car (auction price, fees, shiny salesman guy, etc).  Therefore you make the Trustee an offer.  Your Brooklyn Bankruptcy Lawyer says to the Trustee:  ”Trustee (insert name), my clients are willing to give you $6000 for the vehicle in two payments of $3000 each.  Love (or sincerely), Brooklyn Bankruptcy Lawyer Daniel Gershburg.”  The trustee may accept this, or they may simply say I don’t like that offer make me another one.  Either way, if you have some disposable cash, you can and should be able to buy your car back.  On the other hand, for giving up a car worth several thousand, you’d also be able to get out of debt sometimes over $100,000.00. In any case, the choice is yours.

So now you know all (most) there is to know about whether your should file for Chapter 7 Bankruptcy in New York City if you own a car.  There are many more issues surrounding this topic, so please talk to a Bankruptcy Attorney in Bay Ridge, Park Slope, Williamsburg, Sheepshead Bay, or anywhere you may live in Brooklyn, before filing.