Financing during bankruptcy ?

[Lacy]

Has anyone ever gotten financing on a vehicle while in bankruptcy ? .... If so is it legal to do that while in it ?

[keepmine]

In a Chapter 7 or 13.
In a 13, you need the permission of the trustee to acquire new debt but, it's doable.
In a 7, you are not supposed to incur new debt while the is pending. Also, most finance companies won't fund a loan until discharge because, it's a violation of the auto matic stay to send billing statements until the bk is discharged.

[Lacy]

In a Chapter 7 or 13.
In a 13, you need the permission of the trustee to acquire new debt but, it's doable.
In a 7, you are not supposed to incur new debt while the is pending. Also, most finance companies won't fund a loan until discharge because, it's a violation of the auto matic stay to send billing statements until the bk is discharged.

Thank you for responding.

I had heard of people being able to do it just wasn't sure if this was legal to do or not.

So if someone did get a loan on a vehicle without getting permission from the trustee. Could they get in trouble for doing so ?

[keepmine]

Thank you for responding.

I had heard of people being able to do it just wasn't sure if this was legal to do or not.

So if someone did get a loan on a vehicle without getting permission from the trustee. Could they get in trouble for doing so ?

It'll just raise the question of, where is the money coming from to afford a monthly payment. It'll throw the accuracy of your schedules into doubt.

[Lacy]

It'll just raise the question of, where is the money coming from to afford a monthly payment. It'll throw the accuracy of your schedules into doubt.

So I guess they might could throw your chapter 13 out then. Well some peoples income may change after filing for chapter 13. See know I'm wondering if that's something your suppose to report too.

[keepmine]

So I guess they might could throw your chapter 13 out then. Well some peoples income may change after filing for chapter 13. See know I'm wondering if that's something your suppose to report too.

Instead of asking a lot of what if questions, why not just post the specifics of your situation? Are you presently in an active bk? Is it a 7 or a 13? Has your income changed since filing?

[Flamingo]

So I guess they might could throw your chapter 13 out then. Well some peoples income may change after filing for chapter 13. See know I'm wondering if that's something your suppose to report too.

In the event you are in a Chapter 13.....To be brief, you cannot incur any debt during a CHapter 13 without your Trustee's permission, car loans included. Most vehicle dealers know that and when they find out you are in a Chapter 13 they will advise you they need approval from the BK Court for you to take on that debt if you can be approved. Secondly, as to extra income after the filing of your Chapter 13, yes you are supposed to report it to your attorney who will advise the trustee if necessary. Some Trustees require all changes in income to be reported some only over a certain percentage. Your attorney will know what is required under your Plan and can advise you accordingly.

[Cali]

Lacy - in some areas they do have you report any increase in income. And you like it was stated earlier, you have to get permission in a C13 and you cant in a C7.

I would also suggest you telling everyone more about what your situation is. IT is hard to answer questions if we really don't know the background.

[AngelinaCatHub]

So I guess they might could throw your chapter 13 out then. Well some peoples income may change after filing for chapter 13. See know I'm wondering if that's something your suppose to report too.

No offense Lacy, but my concern and I have seen it in my own family and from personal history, too many people get debt removed and START ALL OVER AGAIN! If I ever get out of my 7, cash only, it truly is King. 'Hub

[Lacy]

Thank you everyone for responding.


I am a little hesitant to mention any specifics here. I'm just a little afraid of maybe it could harm me some type away by doing so. So I do apologize for not giving more info.

Thanks again everyone !

[cooper_monica]

Quick ?

I dont want to really get a major car not but there are alot of buy here pay here dealerships around that will allow u to basically pay off the vehicle in two payments or possibly over a months time. I have been trying to save up for a reasonable priced used vehicle, and saw a decent car today for 4400 dollars.

I have half of the money but I would need to make payments, how long does it take to get discharge papers in a chap 7 case, since most of these places dont check credit would it affect my bk if i chose to do this before the date. And if not does the info regarding discharge paperwork show up on pacer or should I just call to the help desk.

[sharksfan]

I've seen a lot of "you can't get new debt prior to chapter 7 discharge". Can someone please point me to the section of BK code that this is written?

[HHM]

I've seen a lot of "you can't get new debt prior to chapter 7 discharge". Can someone please point me to the section of BK code that this is written?

It depends on the nature of the debt, but yes, see section 523(a)(2) regarding exceptions to discharge with regard to no new debt "prior" to BK.

The reason you cannot incur new debt "during" a BK is because you have "technically" turned over your entire financial life to the US trustee. During the pendency of your BK, the trustee is "legally" in control of your finances.

[HHM]

Thank you everyone for responding.


I am a little hesitant to mention any specifics here. I'm just a little afraid of maybe it could harm me some type away by doing so. So I do apologize for not giving more info.

Thanks again everyone !

Ok, if you don't want to give us useful info, than we can't help you. Good luck.

But, pleeezzzz, this is an anonymous forum. If you are planning on making a purchase of some kind, we can guide you. Regarding financing "during" a BK for a vehicle, what you are talking about is a 722 redemption loan. However, those are generally used to purchase back your vehicle from the trustee in the event you have non-exempt equity, they are typically not used for the purpose of buying a car during a BK.

[sharksfan]

The reason you cannot insure new debt "during" a BK is because you have "technically" turned over your entire financial life to the US trustee. During the pendency of your BK, the trustee is "legally" in control of your finances.

The way I understand it is that your turn over your financial life UP TO your filing date.