Expert: Terry Leeders - 5/30/2008

Question
I HAVE A MOTORCYCLE THAT I HAVE TO CLAIM ON MY BK, BLUE BOOK VALUE FOR IT IS $6000 BUT I OWE $15000.  IT WAS SUGESTED TO ME TO RENEGOTIATE WITH THE LEAN HOLDER SOMETIME DURING THE BK TO BRING DOWN WHAT I OWE. IS THIS POSSIBLE, WHY WOULD THEY WANT TO CUT DOWN THE $15000 FOR ME??

Answer
You have 3 choices in chapter 7 bankruptcy.
1. Surrender the vehicle and eliminate the debt.
2. You can reaffirm the debt, Re-sign the loan, renewing the terms (sometimes negotiable depending on the lender)
3. Redemption: buy the vehicle for fair market value and eliminate the rest of the over-financed portion. This is done by motion.  There are lenders available to finance the buyout money for you. Then you would start fresh on the new loan for the lower amount if approved.  
Ask your attorney to explain these three options for you.