Q: I defaulted on a $13000 car loan. Is it better to file bankruptcy or hope the bank eventually gives up trying to collect
The loan was joint with my ex boyfriend and he has had the car for 3 years. Car value is abt $3000. I have no money and no house but I have a 2006 Jeep with an upside down loan on it. I’m a server.
A: $13,000.00 is too much debt to have over your head going forward. I'm not sure where you are located, but the statute of limitations in Kentucky for written contracts is 10 years (was formerly 15). This means that the creditor would have ten years under current KY law to initiate a collection action against you to recover amounts owed on the account. Bear in mind that interest will continue to accrue on the account until its paid or you file for relief under Chapter 7 of the bankruptcy code. Chapter 7 is definitely an option you should STRONGLY consider!
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