The Bankruptcy Code treats vehicle loan claims differently, depending on how long ago you purchased your vehicle. Specifically, if you purchased your vehicle less than days ago, you will end up paying the full balance due, with interest, in your Chapter Jan 15, · The Day and 1-Year Timing Conditions But as we’ve been discussing there are timing conditions you must meet to qualify for Chapter 13 cramdown. With vehicles you must have entered into the contract at least days (about two and half years) before filing the Chapter 13 case. The Day Rule Qualification One limitation to cramming down your car loan is that you must acquire the car loan more than days before you filed for bankruptcy. The law intends to prohibit cramdowns on newly purchased cars. If days haven’t passed, you won’t be able to cram down Author: Cara O'neill, Attorney.
I purchased the car well before 2 and a half years, but refinanced it last year around this time. Will I be able to place the majority in unsecured? Bankruptcy Mastery Becoming a better bankruptcy lawyer. Filed Under: Bankruptcy Practice. Comments Dennis K. Cowan says. May 22, at pm. Michael says. May 31, at am. CathyMoran says. Ian Williamson says. November 5, at pm. With vehicles you must have entered into the contract at least days about two and half years before filing the Chapter 13 case.
With any other kind of collateral the contract must be at least a year old. You are stuck with the full balance on the vehicle loan. Then you can do a cramdown at any time.
Rather you owned the vehicle or other collateral free and clear and provided it as collateral for a loan. You had fallen behind on your home mortgage and were desperate to catch up. But your refund was smaller than you expected, and went to other even more pressing expenses. So you renewed the title loan, twice.
You are afraid your car is about to be repossessed. There are other reasons having to do with your home mortgage, but you also learn you can do a cramdown on this car title loan.
The lender might be willing to adjust some of the terms of the loan. But it would have no obligation to do so. The only leverage you have is your threat to let them take away your vehicle. That way the lender would only get the liquidation value of your vehicle. But the lender knows that you likely really need your vehicle. Under slightly different circumstances there could be a similar result even under Chapter