Brad Weil Law > Blog > 2019 > April

What Happens To My Collateral In Chapter 7?

When you borrow money to buy a house or car, that property generally serves as collateral for the debt you owe. That is, you don’t truly own the property until you pay off the debt, and if you stop paying on the loan then more than likely a process will begin that ends with you giving your property back. If you file for Chapter 7 bankruptcy and owe money on property that serves as collateral, then you will need to choose one of three ways to handle that debt.