Surrendering Property when Filing Bankruptcy
Debtors that file bankruptcy and decide to surrender something often times will ask how long they have until the car is picked up or until their house is foreclosed on. The answer varies depending on if they file a Chapter 7 or Chapter 13 and if it is a house or a car.
If a Debtor files a Chapter 7, a Creditor will usually file a motion to lift the automatic stay, but not always. The general rule says that 30 days after the Statement of Intentions is filed, the Debtor must abide by their intentions. This is more applicable to cars, but does mean a mortgage company can start the foreclosure process after 30 days of filing the Statement of Intentions. However, if it is a car, the best thing for a Debtor to do is contact the Creditor and set up a time for them to pick up the car or for the Debtor to drop the car off somewhere. This allows the Debtor to be in control of when the car is surrendered and to make sure there are no personal items left in the car.
If a Debtor files a Chapter 13, the stay is lifted after 6 days of filing the plan showing the Debtor intends to surrender the property. A Chapter 13 doesn’t give Debtors as much time, so they need to already have alternate means of transportation or start looking for a new place to live.
Regardless of which Chapter is filed, the Debtor must surrender the car and not hinder the Creditor from getting their property back. If a Debtor hides a car or doesn’t allow the Creditor to retrieve the car, they have committed a criminal act of theft and the Creditor can file criminal charges.
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