The short answer is that you signed a contract to pay for a loan, and you are responsible regardless of whether you have the car or not. You agreed to be personally responsible for the balance on the loan when you signed the loan documents at the time that you purchased the car.

When you get a loan to buy a car, the lender gives you a stack of papers to sign. Of the documents, one gives the car lender the right to repossess your car if you don’t make payments on the car. Another document gives the lender the right to sue you if you don’t make your car loan payments, even if you no longer have the car. In general, you will be responsible for the loan whether you have possession of the car or not. This includes voluntary or involuntary repossessions of the car, the car being damaged as a result of accidents, or losses due to other causes.

In those circumstances, you are still responsible for the balance on the loan. And if you don’t pay, the car lender will attempt to collect from you including filing a lawsuit against you. They can then freeze your bank account or garnish your wages.

You may be able to eliminate the debt by filing a chapter 7 or chapter 13 bankruptcy. An experienced attorney from the Law Offices of Daniel J Winter will be able to analyze your particular situation and advise you whether a bankruptcy case could be a solution to solve your financial problems.

Laxmi P. Sarathy
Law Offices of Daniel J. Winter
53 West Jackson Blvd
Suite 725
Chicago, IL 60604
ph: 312-427-1613
fax: 312-663-1312