Title Loan

Can you file for bankruptcy on a title loan, cash loan or cash advance?

The answer is yes!
Many of you have been pushed into a title loan, cash loan, or a cash advance due to the state of the economy. Unfortunately, many of you may not know that a payday title loan, cash loan, or cash advance can have a very, very high rate of interest, along with other charges.

Cash Loan or Cash Advance

A cash loan and a cash advance are usually unsecured. An unsecured cash loan or cash advance means that no property has been put up as security for the repayment of the loan. If your cash loan or cash advance is unsecured, the loan can be completely wiped out in a Chapter 7 bankruptcy liquidation plan and reduced by as much as 90% in a Chapter 13 liquidation plan.

Bankruptcy on a Title Loan

Although such companies have attempted to contend that title loans are not secured debts, the Bankruptcy Court for the Western District of Tennessee treats them as a secured debt. Thus, the interest rate you are paying on your title loan can usually be reduced from the 30% to 40% you may be paying to a much lower rate. Presently, the loan rate can be reduced to 5.25%. In addition, your loan can be repaid over 60 months. This further allows you to reduce the payment to the title advance company. Both of these options can reduce your present payment to the title loan company to a very small amount. Also, it may be possible to further reduce your payment to the loan company if the value of your car is less than the amount you owe to the title loan company.

Do not act on anything you read on this site without hiring an attorney. This is why we offer, for free, to prepare a bankruptcy petition for you to see what works best in your personal financial situation. We provide representation for individuals who live in Lauderdale, Tipton, Fayette and Shelby County, Tennessee, who qualify to file bankruptcy in the Bankruptcy Court for the Western District of Tennessee located in Memphis, Tennessee.

^*For those who qualify under federal law.