Posted on February 8, 2009 at 6:55 pm We just took a 10% pay cut and we will not be able to make our payments anymore. We have $37,000 in unsecured debt and we have 2 car payments. We owe $43,000 on one car(with only about $3,000 paid towards the original loan) and $29,000 on the other car(about $6,000 paid towards it). With a 10% pay cut we will be over our paychecks each month now by $1,500. Anyway, my question is, what happens to the cars? There is no way we will be able to afford to keep them now. I don't even think we can afford to keep one of them. What happens to them in a chapter 7? Will they still make us pay the remaining amount after they auction them and how can we do this if we don't have the money anymore? Please help! We were hoping it wouldn't come to this but since it has we need to know where we stand. I plan to visit a lawyer ASAP but need a little info before hand. Thank you!

Posted on April 1, 2009 at 7:14 pm I went through this.  Among other things before we filed for bankruptcy we were something like 3 months behind on both of our cars.  When we ran out of options with everything we starting inquiring about bankruptcy.  If you are currently up to date on your car payments you can keep your cars. If you are behind on your car payments, as I was, and are not able to make them current then you will have to file chapter 13 bankruptcy if you want to keep your cars.  We ended up having to file chapter 13.  I believe that's the way it went. But also from my understanding each state has their own set of rules.  I filed in SC