Legal Question in Bankruptcy in Virginia

Re: Exempt property

Your lawyer should be able to advise you as to the specifics, but the car should be listed as an asset on Sched. B at its fair market replacement value, should be claimed as exempt using the proper exemption in Schedule C, and the secured claim should be listed on Sched. E, with the unsecured portion being the amount over the fair market value. You most likely can continue to make payments and keep the car, and since there is no equity (assuming you are right), the exemption claim does not even matter - it's just claimed to protect you in the event the value is deemed to exceed the loan amount.

Re: Exempt property

Whether the car has no equity or is exempt (or not) does not matter. You still list the secured creditor under Schedule D of your schedules. The trustee will see that there is no equity in the vehicle when he or she does the math (subtracts the payoff from the fair market value). If you have no equity you do not have to use your "poor debtor's exemption" to exempt the vehicle under Schedule C. You also list the vehicle and creditor under 2.B of your Statement of Intention: "Property to be retained."

Re: Exempt property

You need to consult with an experienced bankruptcy attorney. He can advise you as to whether you are a candidate to redeem the collateral using Redemption Funding and Code Section 722. That is the real issue for you.