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Auto loan during Chapter 13

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    Auto loan during Chapter 13

    Does anyone know how difficult it will be to obtain an auto loan while in a Chapter 13? I'm paying my current car loan (reaffirmed) outside of the Chapter 13 but it's time to trade in the car for a newer one. Specifically, has anyone had any experience doing this? I know it would've been easier and cheaper to do this before I filed. Are there dealerships/banks/manufacturers that will do this? Thanks

    #2
    I will let you know! We just got our order to incur new debt yesterday for the purpose of buying a vehicle. We are allowed 16K. I've heard once you have that piece of paper it's not terribly hard to find financing, but the rates are horrendous! I'm just crossing my fingers at this point as my husbands car is dying fast.
    Chapter 13 Filed: 2/7/07 Confirmed: 5/1/07 Discharged: 3/2/2012 Closed: 6/2/2012
    130 out of 130 bi-weekly payments DONE
    100% Completed

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      #3
      There has been numerous conversation on this forum about your subject. Have you done a search on here? You will be surprised what you find to help you! :-) First things first, you will need Trustee approval before you can finance a car while in active Chapter 13.
      _________________________________________
      Filed 5 Year Chapter 13: April 2002
      Early Buy-Out: April 2006
      Discharge: August 2006

      "A credit card is a snake in your pocket"

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        #4
        Well, it isn't too hard, but the financing pretty much sucks. We were approved at 18%. Car has to be under a certain mileage--I think 70K (hubby deals with this stuff) & car cannot be V8 (this will be a problem for us as we need 3rd row seating & already have a minivan & we were hoping for SUV). Other than that, it was smooth sailing getting approved. Of course getting the trustee & judge to sign the order took 3 months! We might set up a loan arrangement with my mother-in-law now since we want to get a V8 SUV & lower interest, but this will be ok because we have the order (already asked our lawyer). We of course will set up amortization & payment schedule in case there is ever an issue.
        Chapter 13 Filed: 2/7/07 Confirmed: 5/1/07 Discharged: 3/2/2012 Closed: 6/2/2012
        130 out of 130 bi-weekly payments DONE
        100% Completed

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          #5
          It's tough, but it can be done. Trust me, we've done it twice now

          The second time we modified our plan to reduce our payment amount to allow for most of the car payment.

          Although, we did this for the first time in Nov 07, and the second car in June 08, so...................things are tighter now I'm sure where credit is concerned.

          Our interest rates were 11.75% on the 1st time around, and 11.25% on the second vehicle. Not great, but all things considered, not bad either.

          I don't know where you looked for financing, but we ended up going with a credit union (fairly local). The dealer handled the first one, and I just went directly to them on the second.

          Good luck to you!

          PS: Another tip is to check with your attorney for suggestions of lenders. They probably can refer you to a lender or two who will finance in an open 13, as they've had other clients do so.

          K
          You can't have your cake and eat it too. But you can dip your finger in the bowl and lick the icing

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            #6
            This is helpful info as we haven't filed yet. But we are current/keep car 1, with a monthly payment of 353 (2007) and my car is a 1999 car with 202K miles and I commute 100+ miles/day. Clearly I can drive the newer car (not as great mileage) BUT at some point we need to replace the '99. Was wondering if doing it now (before filing)-- but we have high DTI, just starting NOT paying CC's (none are 30+days late) but spouse on UI....but I have a decent income. I have no idea who'd possibly give us a car loan and of course the interest would be outrageous!

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