You will have several decisions to make when it comes to your Chapter 7 bankruptcy concerning how you want your debts to be handled. Many individuals are under the impression that they can just file for this type of relief and all their debts are wiped clean. This is not always the case, and you may have to determine what you want to do in some cases.
You may have the option to just surrender a secured debt. What this simply means is that you give back the property that was secured to the creditor, and then it is wiped clean.
Keep in mind that when it comes to your secured debt that in a bankruptcy your personal obligation for the load is discharged, but the lien on the property is not. However, when you surrender the property then the lien is gone. Once you decide that you do want to surrender the property you must notify the courts through your bankruptcy filing that you wish to do this. Once accepted by the courts then it is up to the creditor to come and get the property. If the creditor doesn’t take this action, and the bankruptcy trustee doesn’t have any interest in it, then you may get to keep the property.
Before you make the decision as to what to do with any of your secured property you should discuss this with your Kentucky bankruptcy attorney.
There are advantages and disadvantages to surrendering your property. If you really don’t want or need it, then there is no point in holding onto it. Affordability is another reason for giving it up. If you are not able to redeem the property because you have no cash then again it may be worth giving it up.