Can Chapter 13 stop a repossession?

Filing operates as a stay of acts to obtain possession of property of the estate and to enforce liens against it (11 U.S.C. § 362(a)(3), (a)(4)), which commonly halts a repossession in progress. The stay is not unconditional: a creditor can move for relief, and prior dismissed cases within the past year can shorten or prevent it entirely.

Do I have to keep making my regular car payment during the case?

In most cases payments continue in some form, though the mechanics change. A plan may provide for curing a default and maintaining payments while the case is pending (11 U.S.C. § 1322(b)(5)), and § 1326(a)(1) requires payments to begin no later than 30 days after the plan is filed or the order for relief, including adequate protection to a personal-property lender. Your district's rules determine whether those flow through the trustee.

What happens if I stop paying car insurance during a Chapter 13 case?

Lapsed insurance is a serious problem. Section 1326(a)(4) requires a debtor keeping personal property securing such a claim to provide the secured creditor reasonable evidence of required insurance within 60 days of filing and to continue doing so. Local rules add teeth: the Middle District of Alabama has a rule letting a creditor demand proof and seek relief from the stay if it is not provided.

Can the lender object to my plan?

Yes. Confirmation under 11 U.S.C. § 1325(a) requires the court to make specific findings about each allowed secured claim, and a lender can contest whether the plan meets them. The plan generally must let the lender retain its lien, distribute value at least equal to the allowed amount of the claim, and make periodic payments in equal monthly amounts with adequate protection where personal property secures the claim.

What if I decide the car payment is not worth keeping?

Surrender is an express option. Under 11 U.S.C. § 1325(a)(5)(C), a plan satisfies the secured-claim requirement for a particular claim if the debtor surrenders the property securing it to the holder. That choice affects your budget and the rest of your plan, so it is worth modeling with an attorney before committing to it in a filed plan.

What does filing a Chapter 13 case cost?

The Chapter 13 filing fee is $235 (28 U.S.C. § 1930(a)(1)(B)), plus a $78 administrative fee (Bankruptcy Court Miscellaneous Fee Schedule, Item 8). The statute permits an individual to pay the filing fee in installments. Attorney fees are separate and in Chapter 13 are often paid through the plan; ask about the arrangement at your first meeting.

Does my co-signer get any protection?

Chapter 13 has a codebtor stay. Under 11 U.S.C. § 1301(a), after the order for relief a creditor generally may not act to collect a consumer debt of the debtor from an individual who is liable on it with you or who secured it, subject to exceptions. A creditor can ask the court for relief from that stay on the grounds listed in § 1301(c).

Is this the same as redeeming a car in Chapter 7?

No. Redemption under 11 U.S.C. § 722 is a Chapter 7 mechanism that lets an individual debtor pay the holder of a lien the amount of the allowed secured claim in full at the time of redemption, for exempt or abandoned tangible personal property. Chapter 13 works differently, spreading treatment of the claim across a court-confirmed plan rather than requiring a lump payment.

Vehicles & secured debt

Keeping a Car in Chapter 13

Chapter 13 generally lets you keep a financed car by curing the past-due amount through a repayment plan rather than paying it all at once. Federal law lets a plan cure a default and modify most car loans, but the lender keeps its lien and must receive value at least equal to its allowed secured claim (11 U.S.C. § 1322(b), § 1325(a)(5)).

Key points

A Chapter 13 plan can provide for curing any default on a car loan and maintaining payments while the case is pending (11 U.S.C. § 1322(b)(3), (b)(5)).
Chapter 13 can modify the rights of most secured creditors, but the limit on modification protects only a claim secured solely by the debtor's principal residence (11 U.S.C. § 1322(b)(2)).
For a car you keep, the plan must generally let the lender retain its lien and distribute value at least equal to its allowed secured claim, in equal monthly payments (11 U.S.C. § 1325(a)(5)(B)).
Payments start early: the debtor generally begins making plan payments no later than 30 days after filing, including adequate protection payments to a creditor secured by personal property bought by the debtor (11 U.S.C. § 1326(a)(1)).
Insurance is not optional — a debtor keeping personal property must give the secured creditor reasonable evidence of required insurance within 60 days of filing (11 U.S.C. § 1326(a)(4)).

If you are behind on a car payment and the lender is threatening repossession, the car is usually the thing you cannot afford to lose. It gets you to work, and losing it can unravel everything else. Chapter 13 exists in part for this situation: it is a court-supervised repayment plan that can spread out what you owe while you keep the vehicle, provided you meet the requirements federal law sets for confirming that plan.

How does keeping a car in Chapter 13 actually work?

Chapter 13 is a repayment plan. Instead of paying the entire past-due balance to your lender at once, the plan proposes how the debt gets handled over time under court supervision. Two provisions do most of the work. First, a plan may provide for curing or waiving any default (11 U.S.C. § 1322(b)(3)), and may provide for curing a default within a reasonable time and maintaining payments while the case is pending (11 U.S.C. § 1322(b)(5)). Second, a plan may modify the rights of holders of secured claims, other than a claim secured only by a security interest in real property that is the debtor's principal residence (11 U.S.C. § 1322(b)(2)) — so a car loan is not shielded from modification the way a home mortgage is. The Bankruptcy Court for the District of Arizona describes the same idea plainly: Chapter 13 can be used to cure defaults on secured debts, including defaults on motor vehicles.

What has to be true for the court to confirm the plan?

A Chapter 13 plan is not effective until the court confirms it, and 11 U.S.C. § 1325(a) lists what the court checks. For each allowed secured claim the plan provides for, one of three things must happen: the lender accepts the plan; the plan satisfies the requirements in § 1325(a)(5)(B); or you surrender the vehicle to the lender (11 U.S.C. § 1325(a)(5)(C)). The middle path is the one people mean by keeping the car. Under § 1325(a)(5)(B), the plan must provide that the lender retains its lien until the underlying debt is paid or a discharge is entered, the value distributed on the claim is not less than the allowed amount of the claim, and any periodic payments are in equal monthly amounts. Where the claim is secured by personal property, those payments must be at least enough to provide adequate protection during the plan.

The lender accepts the plan, or
The plan meets the lien-retention, value, and equal-monthly-payment requirements of § 1325(a)(5)(B), or
You surrender the vehicle to the lender under § 1325(a)(5)(C).

What changes the answer for a particular car?

The same statute produces different outcomes depending on facts specific to your loan and your budget. The biggest variables are what the lender is owed, what the vehicle is worth, and whether you can actually fund the plan. Confirmation also requires a finding that you will be able to make all payments under the plan and comply with it (11 U.S.C. § 1325(a)(6)), so a plan payment you cannot sustain is not a plan the court can confirm. Timing matters too. For purposes of the secured-claim rules, § 1325 contains a limitation on applying § 506 to certain claims — which is why the age of the loan and the purpose of the purchase can affect how a vehicle claim is treated. These distinctions are the kind of thing a bankruptcy attorney evaluates against your loan documents, not something a general article can settle.

The balance owed compared with the value of the vehicle
How far behind you are and how long the plan runs
Whether the loan was used to purchase the vehicle, and when
Whether your income supports both the plan payment and living costs
Whether the lender objects to how the plan treats its claim

What does federal law say about payments and insurance?

Two obligations start almost immediately, and missing them is a common reason a case goes badly. Under 11 U.S.C. § 1326(a)(1), the debtor generally commences making payments no later than 30 days after the plan is filed or the order for relief, whichever is earlier — including payments that provide adequate protection directly to a creditor holding an allowed claim secured by personal property, to the extent the claim is attributable to the debtor's purchase of that property. Those amounts reduce what goes to the trustee, and you must give the trustee evidence of payment. Separately, § 1326(a)(4) requires a debtor keeping personal property securing such a claim to provide the secured creditor reasonable evidence of required insurance no later than 60 days after filing, and to keep doing so as long as you hold the property. The District of Arizona's guidance says the same thing in ordinary language: you must maintain insurance on your car and show the lender proof.

Does filing stop a repossession that is already underway?

Filing a bankruptcy petition operates as a stay of a broad list of creditor actions, including any act to obtain possession of property of the estate or to exercise control over it, and any act to enforce a lien against property of the estate (11 U.S.C. § 362(a)(3), (a)(4)). That is the provision people mean when they say bankruptcy stops a repossession. It is not permanent or unconditional. Section 362 also sets out how a creditor asks the court for relief from the stay, and courts have local procedures for those motions. The Arizona court's guidance notes that if you filed a bankruptcy case within the past year that was dismissed, the automatic stay may protect you only for 30 days after the new case is filed, and if two or more cases were dismissed in the prior year, the stay may not go into effect at all unless the court orders it after a hearing. Timing relative to any earlier filing genuinely matters here.

Where do state or local rules differ?

The core rules for keeping a car in Chapter 13 are federal and do not change from state to state. What changes is the local procedure layered on top, and it changes more than people expect. The Southern District of Texas, for example, has a local rule providing an adequate protection framework for vehicles that requires the debtor to maintain insurance in the amount required by the prepetition contract, provide proof of insurance to the lien holder, and enter a wage or EFT order within a set period. The Middle District of Alabama has a local rule addressing exactly what happens when a creditor lacks proof of insurance on a vehicle a Chapter 13 debtor proposes to retain and pay for. Exemption amounts, which affect vehicle equity, are also set by state law under 11 U.S.C. § 522 — those figures live on our state pages rather than here.

What does this look like in practice?

The practical sequence is easier to follow than the statute. You file, and the automatic stay under § 362 takes effect. You file a plan describing how the car loan is treated. Within 30 days of filing the plan or the order for relief, whichever is earlier, payments begin under § 1326(a)(1) — to the trustee, and where applicable directly to the vehicle lender as adequate protection. Within 60 days you provide the lender reasonable evidence of insurance under § 1326(a)(4). The lender may file a proof of claim and may object to how the plan treats it. The court then decides confirmation against the § 1325(a) checklist. If the plan is confirmed, you keep making payments; § 1325(a)(5)(B)(i)(II) provides that if the case is dismissed or converted without completion of the plan, the lender retains its lien to the extent nonbankruptcy law recognizes it.

Deadlines federal law attaches to keeping a financed vehicle
Step	Timing	Authority
Automatic stay takes effect	On filing the petition	11 U.S.C. § 362(a)
Plan payments begin, including adequate protection to a personal-property lender	Not later than 30 days after the plan is filed or the order for relief, whichever is earlier	11 U.S.C. § 1326(a)(1)
Provide the lender reasonable evidence of required insurance	Not later than 60 days after filing, and continuing	11 U.S.C. § 1326(a)(4)
Court decides whether to confirm the plan	After notice and the § 1325(a) findings	11 U.S.C. § 1325(a)

What documents and information are involved?

Gathering paperwork early makes the vehicle question much easier to answer. The loan documents matter most: they show the balance, the interest rate, whether the lien is properly noted, and what insurance the contract requires. Courts ask for vehicle information directly. The Northern District of Ohio's local rules provide that a stay-relief motion about a motor vehicle must state the vehicle's value based on a recognized used vehicle guide and the balance claimed due, and attach the certificate of title or registration showing the lien. Official Form 122C-2 asks Chapter 13 filers to describe each vehicle and to calculate ownership or lease expense, including the average monthly payment to each creditor secured by that vehicle. You will also owe filing costs: the Chapter 13 filing fee is $235 (28 U.S.C. § 1930(a)(1)(B)) plus a $78 administrative fee (Bankruptcy Court Miscellaneous Fee Schedule, Item 8).

The retail installment contract or loan agreement and payoff statement
Certificate of title or registration showing the lienholder
Proof of current insurance naming the lender as loss payee
A value for the vehicle from a recognized used vehicle guide
A record of how far behind the account is and when the default began

What should you ask a lawyer?

This page describes the federal framework; only a bankruptcy attorney who has read your loan and your budget can tell you how it applies. Bring the loan documents and a realistic monthly budget to the first meeting, and ask direct questions about the vehicle rather than about bankruptcy in general. Cost is a fair question too: attorney fees in a Chapter 13 case are often paid through the plan, and the fee arrangement is something to discuss up front. Court guidance is consistent on one point across districts — the Alaska filing packet states you should have an attorney review your decision to file and your choice of chapter.

How would a plan treat this specific car loan, and would the lender likely object?
What would the monthly plan payment be, and can my income sustain it for the full plan?
Does anything about the age or purpose of this loan change how the claim is treated?
What adequate protection payment would start within 30 days, and to whom?
Does my district have local rules or a form plan that affect vehicle treatment?
What happens to the car if the case is later dismissed or converted?

Frequently asked questions

Can Chapter 13 stop a repossession?: Filing operates as a stay of acts to obtain possession of property of the estate and to enforce liens against it (11 U.S.C. § 362(a)(3), (a)(4)), which commonly halts a repossession in progress. The stay is not unconditional: a creditor can move for relief, and prior dismissed cases within the past year can shorten or prevent it entirely.
Do I have to keep making my regular car payment during the case?: In most cases payments continue in some form, though the mechanics change. A plan may provide for curing a default and maintaining payments while the case is pending (11 U.S.C. § 1322(b)(5)), and § 1326(a)(1) requires payments to begin no later than 30 days after the plan is filed or the order for relief, including adequate protection to a personal-property lender. Your district's rules determine whether those flow through the trustee.
What happens if I stop paying car insurance during a Chapter 13 case?: Lapsed insurance is a serious problem. Section 1326(a)(4) requires a debtor keeping personal property securing such a claim to provide the secured creditor reasonable evidence of required insurance within 60 days of filing and to continue doing so. Local rules add teeth: the Middle District of Alabama has a rule letting a creditor demand proof and seek relief from the stay if it is not provided.
Can the lender object to my plan?: Yes. Confirmation under 11 U.S.C. § 1325(a) requires the court to make specific findings about each allowed secured claim, and a lender can contest whether the plan meets them. The plan generally must let the lender retain its lien, distribute value at least equal to the allowed amount of the claim, and make periodic payments in equal monthly amounts with adequate protection where personal property secures the claim.
What if I decide the car payment is not worth keeping?: Surrender is an express option. Under 11 U.S.C. § 1325(a)(5)(C), a plan satisfies the secured-claim requirement for a particular claim if the debtor surrenders the property securing it to the holder. That choice affects your budget and the rest of your plan, so it is worth modeling with an attorney before committing to it in a filed plan.
What does filing a Chapter 13 case cost?: The Chapter 13 filing fee is $235 (28 U.S.C. § 1930(a)(1)(B)), plus a $78 administrative fee (Bankruptcy Court Miscellaneous Fee Schedule, Item 8). The statute permits an individual to pay the filing fee in installments. Attorney fees are separate and in Chapter 13 are often paid through the plan; ask about the arrangement at your first meeting.
Does my co-signer get any protection?: Chapter 13 has a codebtor stay. Under 11 U.S.C. § 1301(a), after the order for relief a creditor generally may not act to collect a consumer debt of the debtor from an individual who is liable on it with you or who secured it, subject to exceptions. A creditor can ask the court for relief from that stay on the grounds listed in § 1301(c).
Is this the same as redeeming a car in Chapter 7?: No. Redemption under 11 U.S.C. § 722 is a Chapter 7 mechanism that lets an individual debtor pay the holder of a lien the amount of the allowed secured claim in full at the time of redemption, for exempt or abandoned tangible personal property. Chapter 13 works differently, spreading treatment of the claim across a court-confirmed plan rather than requiring a lump payment.

Sources

11 U.S.C. § 1322 — Contents of plan · official source
11 U.S.C. § 1325 — Confirmation of plan · official source
11 U.S.C. § 1326 — Payments · official source
11 U.S.C. § 362 — Automatic stay · official source
11 U.S.C. § 1301 — Stay of action against codebtor · official source
11 U.S.C. § 722 — Redemption · official source
11 U.S.C. § 522 — Exemptions · official source
28 U.S.C. § 1930(a)(1)(B)
Bankruptcy Court Miscellaneous Fee Schedule, Item 8
U.S. Bankr. Ct. D. Ariz., Choosing Your Chapter: What can Bankruptcy do for you? What will it do to you?
Texas Southern Bankruptcy Local Rules — October 29, 2024 final
Bankr. M.D. Ala. R. 4070-1
Final%20Version%20of%20Amended%20LBRs_Effective%20Oct%201%202020_Redline.pdf
Bankr. M.D. La. filing packet — Ch13_Vol_Petition_ Package-2026.pdf
U.S. Bankr. Ct. D. Alaska, The Forms Individuals and Married Couples Need to File Bankruptcy

By Antonio G. Jimenez, Esq. · Florida Bar No. 21022

Last reviewed July 26, 2026 · Sources verified July 26, 2026 · How we verify

Every figure on this page is drawn from a primary legal source and checked against our canonical legal database before publication. Bankruptcy.law is not a law firm and does not provide legal advice.

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