Since opening my Brantford bankruptcy office in 1999, one of the most common questions I am asked is “will I lose my car if I go declare personal bankruptcy in Brantford?” This is a big issue in Brantford, because many of us need our cars to get to work (as we all know, there is no subway in Brantford).
The answer depends on a few factors.
First, if you live in Brantford, or anywhere else in Ontario, you are allowed to keep one motor vehicle worth up to $5,650 if you go bankrupt. So, if you are driving an old car, you may be able to keep it.
However, if there is a lien on your car, or if you got a loan and pledged your car as security, whether or not you keep your car if you go bankrupt is up to the lender. The lender in most cases will allow you to keep the car, provided you continue to make all of your regular car payments.
A word of caution: not all banks will allow you to keep your car. Most banks do, but there is one bank in particular that will automatically repossess your car if you go bankrupt, even if your payments are up to date. I don’t want to get sued so I’m not going to mention the name of that bank in this blog posting, but if you send me an e-mail or give my office a call in Brantford at 519-770-4440 I would be pleased to review your situation and let you know whether or not it is likely that you will be able to keep your car if you go bankrupt.
