bankruptcy car lease
Can I continue to lease cars after bankruptcy?
If I go out and lease a car, then file for bankruptcy, but decide to keep the car and continue making alll payments, my question is what happens when the lease is up in 3 years? Will I be able to lease again? Will I be forced to buy at a high interest rate? Just not sure how bankruptcy will effect a long term leasing commitment. Is it better to buy in this situation to lock in a low rate for 5 years instead of 3?
If you declare bankruptcy, you may not be granted the right to keep your leased vehicle. One or more of your creditors may argue that the money you are paying to the leasing company should in fact be paid to the trustee so as to be distributed among “all” your creditors. That decision will not up to you to decide. But in any event, even if you were permitted to keep your leased vehicle and continue making the payments on it, there is no guarantee that in 3 years down the road, you would be able to lease another vehicle. Also if you bought the car outright, there are certain limitations on the value of the vehicle you are permitted to keep (this value varies by jurisdiction), and you would also not be able to have a loan on it, since that loan would also have to be listed in your bankruptcy filing.
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