In South Florida, numerous individuals lease vehicles rather than purchase. So, I routinely get asked by my clients what happens to their leased vehicle when they file for bankruptcy. The answer is that it depends on what you want to do with your car.
Keep and Maintain
Debtors in either Chapter 7 or Chapter 13 bankruptcy who want to keep their leased vehicle can do just that, keep and continue to make payments on their vehicle. In a Chapter 7 bankruptcy a debtor is usually required to sign a reaffirmation agreement on the lease saying that the leased vehicle debt will survive bankruptcy and debtors are responsible to continue to make regular payments after bankruptcy.
Debtors in Chapter 7 and Chapter 13 bankruptcy also have the ability to surrender a vehicle. Surrendering a vehicle means that you return the vehicle to the secured creditor. The benefit of returning a leased car in a bankruptcy is that the debtor will NOT be responsible for breaking the lease nor will they be responsible for any mile overages on their vehicles.
If you are thinking of filing for bankruptcy in South Florida and would like to speak with an experienced Chapter 7 and Chapter 13 bankruptcy attorney then please contact Shmucher Law, PL, and attorney Ofer Shmucher. We offer free consultations seven days a week and can be reached at 954-309-5559 or 305-741-5553.