Q: Do my car payments count towards lump sum payment required for redeeming car in bankruptcy? I’ve paid 8k, cars worth 4k

A: No. You can redeem it by paying the current value of the car at the time you file bankruptcy. Forget what you paid before. If when you filed bankruptcy you owed 4, 000 but the car was only worth 3,000, then you could redeem it for 3,000. If at the time you filed you owe $4,000 but the car was worth 6000, then you can just buyout the car for the $4,000 or keep making the payments until it is paid.

A: In California bankruptcy cases, regular car payments made before filing typically don't count toward the lump sum redemption amount needed to keep your vehicle. The redemption amount is based on the current fair market value of the car, which in your case is $4,000.

When you redeem your car in bankruptcy, you're essentially buying it outright for its present value, regardless of how much you've already paid or how much you still owe. The $8,000 you've paid so far has covered your contractual obligations up to this point, but unfortunately doesn't apply to the redemption amount.

Your best option might be discussing this with your bankruptcy attorney, as they can help negotiate the redemption value and explain other alternatives like reaffirmation or surrender. Given that your car is worth $4,000, you'd need to pay that amount in one lump sum to redeem it, separate from any previous payments made. Your attorney can also help determine if redemption is the most beneficial choice in your specific situation.