4 Ways to Keep Your Stuff

1. Confirm a chapter 11 or chapter 13 plan under §1123 & §1129(a) although both are ride with too many complications to address here.

2. Redeem it.  Special rules apply to certain vehicles but essentially the debtor is entitled to buy the property from the estate at a value determined by the court, Say a debtor owes $29,000 on his dually/diesel pickup he uses personally that he bought more than 910 days prior to filing. The court determines the value is only $17,500.  The debtor can borrow the money from an outside source and keep the truck by paying the creditor $17,500. The balance is treated as an unsecured loan. Where is a debtor going to borrow $17,500? There are lenders out there who makes those kinds of loans.

3. Reaffirm the debt, either at the present contract rate and terms (if the debtor cannot do better); or some mutually agreed modification of it.

4. Claim it as exempt. Since secured debt owed on property diminishes the equity the owner has, there is often little that needs to be exempted. Moreover, many debtors are so far upside down in the mortgages on their homes, that they are electing to surrender them, thereby availing themselves larger allowances.