Chapter 13 Bankruptcy, Keep Your Car?
If you live in Maryland—especially in cities where many people file bankruptcy such as Baltimore, Silver Spring, Frederick, Rockville, Gaithersburg, Bowie, Hagerstown, Annapolis, College Park, Salisbury, Laurel, Greenbelt, Cumberland, Takoma Park, Hyattsville, Elkton, Cambridge, Aberdeen, Westminster, Germantown, Dundalk, Bethesda, Ocean City, Chestertown, Berlin, Snow Hill, Easton, North East, Havre de Grace, Leonardtown, St. Michaels, Frostburg, Boonsboro, Bel Air, Middletown, or Westminster—you may be concerned about keeping your car if you are facing financial hardship.
What Is Chapter 13 Bankruptcy?
Chapter 13 bankruptcy, often called the “wage earner’s plan,” allows Maryland residents with a steady income to reorganize debts through a court-approved repayment plan lasting three to five years. Unlike Chapter 7 bankruptcy, which can require selling assets, Chapter 13 helps you protect your property—including your vehicle—by allowing you to catch up on missed payments while keeping current.
Understanding the Car Repossession Process in Maryland
Before filing for bankruptcy, it’s important to understand how car repossession happens in Maryland:
Missed Payments: Car repossession typically begins after you miss several payments. Lenders usually attempt to contact you before taking action.
Repossession Without Notice: In Maryland, lenders can repossess your vehicle without a court order and often without prior notice, provided they do not “breach the peace” (e.g., forcibly entering your home).
Vehicle Sale: After repossession, lenders usually sell the car at auction.
Deficiency Balance: If the sale price is less than what you owe, the lender may seek the remaining balance through collections or a lawsuit.
How Chapter 13 Bankruptcy Stops Repossession in Maryland
Filing Chapter 13 bankruptcy in Maryland immediately triggers an automatic stay—a court order halting most collection activities, including car repossession. This gives you time to:
Stop the lender from repossessing your vehicle.
Include your overdue car payments in your Chapter 13 repayment plan.
Catch up on missed payments over three to five years.
Continue making your regular monthly payments directly to your lender.
Maryland Vehicle Exemptions: Protecting Your Car’s Equity
Maryland allows you to protect a portion of your vehicle’s equity through bankruptcy exemptions. These exemptions vary depending on your county, so it’s essential to know local rules if you live in:
Baltimore City or County
Montgomery County (Rockville, Gaithersburg, Bethesda)
Prince George’s County (Laurel, College Park, Hyattsville)
Anne Arundel County (Annapolis)
Frederick County (Frederick)
Washington County (Hagerstown)
Harford County (Aberdeen, Bel Air)
Cecil County (Elkton)
A knowledgeable bankruptcy attorney can help you select the right exemption to safeguard your car’s value during bankruptcy.
Why Choose a Maryland Chapter 13 Bankruptcy Attorney?
Bankruptcy laws and exemption rules can vary across Maryland’s counties and cities. Whether you reside in Baltimore, Frederick, Silver Spring, Gaithersburg, or Annapolis, having an experienced local attorney is vital to:
Assess your financial situation and car loan status.
Maximize your vehicle protection under Maryland law.
Prepare and file your Chapter 13 plan properly.
Guide you through the repayment plan to keep your car and avoid repossession.
Don’t Wait — Protect Your Car Today
If you’re behind on car payments in Maryland and worried about repossession, filing Chapter 13 bankruptcy could be your best option to stop repossession and keep your car. Contact the experienced Maryland bankruptcy attorneys at Bankruptcy Near Me today for a free consultation. Our Maryland office can be reached at 301-550-5408 or by email at info@bankruptcynearme.org.
Protect your vehicle and your financial future with trusted legal help in Baltimore, Frederick, Rockville, Bowie, Gaithersburg, and beyond. Call now to schedule your free consultation.