If you have paid off your car and do not owe any money on it, you retain the car and list it under the automobile exemption in the Chapter 7 bankruptcy.
If you still owe money on the car, you can keep the car by reaffirming the debt. This means you continue making payments to the lender. To reaffirm the debt, include a Statement of Intention with your Chapter 7 bankruptcy documents stating your intention to keep the car by reaffirming the debt. Send a copy of your Statement of Intention to the lender.
Reaffirming the debt in your Chapter 7 bankruptcy will allow you to renegotiate the debt and the lender may offer you better terms (lower payments).
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