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Are my parents liable for the RV balance after bankruptcy discharge?

Are my parents liable for the RV balance after bankruptcy discharge?

Full question:

My parents just filed bankruptcy, Chapter 7. They have an RV. They are keeping the RV but are not signing a reaffirmation agreement, the RV company is just allowing them to keep on making the payments. The RV was discharged in the bankruptcy. IF 3 years from now they decide they cannot afford it anymore and decide to give it back to the RV company, are they liable for the balance on the account?

Category: Bankruptcy
Date: 04/07/2025
State: California

Answer:

If a creditor tries to collect a debt that has been discharged in bankruptcy, the debtor can ask the court to reopen the case to address the issue. The bankruptcy discharge acts as a permanent injunction, preventing creditors from taking any actions to collect the discharged debt, including lawsuits. If a creditor violates this discharge injunction, they can face sanctions from the court, such as civil contempt, which may include fines.

This content is for informational purposes only and is not legal advice. Legal statutes mentioned reflect the law at the time the content was written and may no longer be current. Always verify the latest version of the law before relying on it.

FAQs

How do I protect my assets from Chapter 7?

To protect your assets in Chapter 7 bankruptcy, you can use exemptions allowed by your state. These exemptions can help you retain certain property, such as your home, vehicle, and personal belongings, up to a specified value. It's essential to understand the exemption limits and how they apply to your situation. Consulting with a bankruptcy attorney can provide guidance tailored to your circumstances and ensure you maximize your asset protection.

Will I lose my camper if I file Chapter 7?

Whether you lose your camper in Chapter 7 bankruptcy depends on its value and your state's exemption laws. If the camper's value is below the exemption limit, you may keep it. If it exceeds the limit, the bankruptcy trustee might sell it to pay creditors. It's advisable to consult with a bankruptcy attorney to understand your options and the specific exemptions available in your state.

What is the minimum amount of debt for Chapter 7?

There is no specific minimum amount of debt required to file for Chapter 7 bankruptcy. However, you must pass the means test, which evaluates your income against the median income for your state. If your income is below the median, you qualify for Chapter 7. If it's above, you may need to explore other bankruptcy options or repayment plans.

Can I keep my camper if I file Chapter 7?

You may be able to keep your camper when filing for Chapter 7 bankruptcy, depending on its value and your state's exemption laws. If the camper's value falls within the allowable exemption limits, you can retain it. If not, the trustee may sell it to pay creditors. It's best to consult with a bankruptcy attorney to understand the specifics of your case.

What is a reaffirmation agreement in Chapter 7?

A reaffirmation agreement in Chapter 7 bankruptcy is a legal document that allows you to keep certain secured debts, like a car or RV, by agreeing to continue making payments. This agreement re-establishes your obligation to pay the debt even after bankruptcy discharge. It's important to understand the implications, as failing to pay after reaffirmation can lead to repossession. Consulting with an attorney can help clarify your options.

What assets do you lose in Chapter 7?

In Chapter 7 bankruptcy, you may lose non-exempt assets, which are items not protected by state exemption laws. Commonly lost assets can include valuable property, investments, and certain vehicles. However, many debtors retain essential items like their home, car, and personal belongings within the exemption limits. Understanding your state's exemptions is crucial to determining what you may keep.