I have a vehicle on which I owe $19000. The vehicle is only worth $14000. I am currently out of work and struggling to make my payments which are $375 per month. Can I have the bank repossess the car and not be liable for the difference of $5000? Can I do this without claiming bankruptcy, or would it be better for me to claim bankruptcy?

Your lease or purchase agreement will tell you whether you are liable for any deficiency if the vehicle is repossessed or voluntarily surrendered. If you are liable for the deficiency (which is usually the case) the bank will attempt to collect the amount from you after the vehicle has been sold. If you are unable to make satisfactory payment arrangements with the bank, then bankruptcy may be an option. You may want to contact Collins Barrow Limited at 310-8888 in Alberta, or a Trustee in your area, if you require further information.

Ann Clarke
phone: (403) 296-2972
aclarke@moneyhelp.ca