I want to redeem my car. When do I do it?

Upsolve is a nonprofit tool that helps you file bankruptcy for free. Think TurboTax for bankruptcy. We also provide free education, customer support, and a private community. Over 2 million web visitors since 2018. We never ask for a credit card. Funded by generous donors like Harvard University and featured 4x in Forbes. Explore Tool Now


In a Nutshell

"Redeeming" your car means that you buy it from the lender that you financed it with for the fair market value of the car, paid to the lender in one lump sum. The rest of your loan is discharged.

Written by Kristin Turner, Harvard Law Grad.  
Updated July 22, 2020


"Redeeming" your car means that you buy it from the lender that you financed it with for the fair market value of the car, paid to the lender in one lump sum. The rest of your loan is discharged.

If you would like to redeem your car, you must:

  1. let the bankruptcy court and the lender know on your "Statement of Intention" forms,

  2. file a motion with the court proving the value of the car after you file your bankruptcy, and if the motion is approved, pay the lender the redemption value (fair market value) of your car and have the title released to you.

  3. the rest of the balanced owed is dischargeable

Your approved redemption agreement will specify how much time you have to pay the lender (usually 90 days). Failure to pay on time may result in your car being repossessed and/or your bankruptcy being denied.

What you choose to do with your car in your bankruptcy is entirely up to you, and a choice that made sense for someone else may not make sense for you. We at Upsolve do not recommend any particular way forward, but we hope that this article and others we have written on the topic of secured debt gives you the tools you need to make an informed decision.



Written By:

Kristin Turner, Harvard Law Grad

LinkedIn

Kristin is a recipient of Harvard Law School’s Public Welfare Foundation A2J Tech Fellowship. At Harvard Law, she served as a member of the Harvard Defenders, the Women’s Law Association, and the Harvard Law Negotiation Review. She was the 2016 – 2017 president of the Harvard Bla... read more about Kristin Turner, Harvard Law Grad

It's easy to get help

Choose one of the options below to get assistance with your bankruptcy:

Free Web App

Take our bankruptcy screener to see if you're a fit for Upsolve's free web app!

Take Screener
5089 families have filed with Upsolve! ☆
OR

Private Attorney

Get a free bankruptcy evaluation from an independent law firm.

Find Attorney
3362 people found attorneys this month

Questions about bankruptcy?

Research and understand your options with our articles and guides.

Go to Learning Center →

Already an Upsolve user?

Read Support Articles →

Upsolve is a 501(c)(3) nonprofit that started in 2016. Our mission is to help low-income families who cannot afford lawyers file bankruptcy for free, using an online web app. Spun out of Harvard Law School, our team includes lawyers, engineers, and judges. We have world-class funders that include the U.S. government, former Google CEO Eric Schmidt, and leading foundations. It's one of the greatest civil rights injustices of our time that low-income families can’t access their basic rights when they can’t afford to pay for help. Combining direct services and advocacy, we’re fighting this injustice.

To learn more, read why we started Upsolve in 2016, our reviews from past users, and our press coverage from places like the New York Times and Wall Street Journal.

Close

Considering Bankruptcy?

Try our 100% free tool that thousands of low-income families across the country have used to file bankruptcy themselves. We are funded by Harvard University, will never ask you for a credit card, and you can stop at any time.

File Bankruptcy for Free