Buy a Car before BK?

[kjonyou]

I had a friend (really) that if I am considering doing a BK, his lawer told him to run out and buy a car that he would be happy in for at least 3 years. The theory was that it would have no value to pull from and the loan would stay the same since they could not sell it off. He claims it worked, but it was a few years ago, anyone ever hear of this before? He still had good credit at the time but was over his head in debt, they just told him not to buy anything luxury or high end.

[keepmine]

Pretty standard advice.

[kjonyou]

Would it make a difference if you Leased? I know that basicly, wether u buy or lease its not yours till you have the pink slip, but since I have never leased a car before, I was wondering if that might be a better idea since it can be turned in at the end of 2 or 3 years without actually getting any value for it.

[twuoo]

If your credit rating is trashed from lots of late payments, you'll probably not get a good rate anyway, so is it any better to try to buy a car before you file bk? Who will give you a loan?

[keepmine]

Would it make a difference if you Leased? I know that basicly, wether u buy or lease its not yours till you have the pink slip, but since I have never leased a car before, I was wondering if that might be a better idea since it can be turned in at the end of 2 or 3 years without actually getting any value for it.

A lease or, an auto note make no difference. You still have to be able to make the payments post bk or, you'll get it repoed post bk.
Not getting into the advantages/disadvantages of leasing vs buying but, if you do one or the other before filing bk, the monthly payment needs to be reasonable. You don't want to go from either no car or a beater to leasing/financing a late model BMW.

[keepmine]

If your credit rating is trashed from lots of late payments, you'll probably not get a good rate anyway, so is it any better to try to buy a car before you file bk? Who will give you a loan?

There's a lender for everybody. The rates may be skyhigh and they may require a downpayment but, you'll get financed if you have a job and meet minimum income requirements.

[kjonyou]

uh, my credit is still good as of this month, no late pays in years, no repos, no bk, 650-700 FICO. Current cars has about 7,000 in positive trade in value. But that said, I have no money coming in and paid the last 3 months on credit.

So I am just asking, if I could get a low cost lease with no money down, at a decent rate, would it be any smarter to do it before a BK they trying to buy?

[keepmine]

uh, my credit is still good as of this month, no late pays in years, no repos, no bk, 650-700 FICO. Current cars has about 7,000 in positive trade in value. But that said, I have no money coming in and paid the last 3 months on credit.

So I am just asking, if I could get a low cost lease with no money down, at a decent rate, would it be any smarter to do it before a BK they trying to buy?

You will still have to pay for the lease post bk. How do you intend to do that with no income?

[kjonyou]

Well, I am not looking to BK a new car, I just want to see if I can get lower payments so that when I get a new job, its not such a burdon. If it makes sense to lower my payments through a lease, and if I cant buy a car for say 3 to 5 years after a BK I was just wondering if this is good advice? I live in a big city with alsmost no public transprotation. The typical cummute is an hour each way to work. In this city you need a car.

[PaKettle]

Well, I am not looking to BK a new car, I just want to see if I can get lower payments so that when I get a new job, its not such a burdon. If it makes sense to lower my payments through a lease, and if I cant buy a car for say 3 to 5 years after a BK I was just wondering if this is good advice? I live in a big city with alsmost no public transprotation. The typical cummute is an hour each way to work. In this city you need a car.

If your credit is still good but you thihnk you are going to have to file bankruptcy in the future, go for it. The monthly payment will count as expenses to help you qualify and it will insure that you have a good car at a good interest rate after you file. Most likely you will not reaffirm the loan, you will just keep paying it and the company usually does not repossess a car that is being paid on time each month.

However, you do not want to buy or lease a car a short time before you file, I don't think. I would think you would need to wait at least 6 months, though I'm not sure on that. Anyone know?