Buying a car while in Ch.13. Need advice!

[RegalGS1]

So, I have one year to go until my Ch.13 is discharged. But my car needs a few thousand in repairs. I get a holiday bonus that would fix it. But with over 160,000 miles on the car, I'd rather use that cash to buy a low mileage used car. Which I know will be fine - as long as I pay cash and don't finance the car. BUT, trading in my old car is not OK, as that is an asset in the trustee's eyes. I'm sure my car can go a few more months....so what I was thinking I'd do is trade my car in after I get my bonus. At that point I'd have roughly 6 months left in my Ch.13 plan Is there some way the trustee would find out about this? Or should I not worry?

I could go through the process of getting trustee approval to trade in my car. But I hear that can be a long and difficult process. My lawyer would have to re-submit my paperwork all over again, which could take months, and could also change my payments and/or extend my Ch.13 plan. I want none of that! So with less than a year left - and knowing my car will definitely not make it that long without significant repairs - what should I do? I see 4 options:

1 - buy the new (used) car, trade in my old car, and hope he trustee has no way of knowing about the trade-in
2 - buy the new (used) car, and HOLD ON to my old car. Trustee won't care in this case. I'd still have to make payments on the old car and pay the insurance, but only until my Ch.13 is over
3 - fix the old car, which would feel like throwing money down the drain and a bad investment
4 - do nothing and hope for the best. Not ideal. I have a job and a family and need a reliable car

Obviously, I am leaning towards #1. And #2 is the worry-free (but more costly) option. What would you do in my situation? Anyone been through this that can give me good advice?

Thanks!

[justbroke]

I would never sell any property during an active bankruptcy where the property was not abandoned by the Trustee. Since I have no personal experience with replacing a vehicle during the pendancy of my Chapter 13 discharge, I can't comment on what to expect.

There is a process which is started with a Motion to Substitute Collateral where you may be able to do the "swap" and protect the existing creditor (the creditor that filed a secured claim). Your attorney may charge you an additional fee for such a motion, but maybe that would work for you.

[RegalGS1]

I should also add regarding my existing vehicle: I am still making payments on it, but this creditor is NOT part of bankruptcy plan; the bank I have the loan with has not filed any sort of claim because the car will be paid for in full (whether I trade it in or keep it).

[BriOS]

Regal,

First off, you will not able to finance a car anywhere without trustee approval. The banks will see you are in a 13 when they pull your credit, and will require authorization from the trustee and the courts by way of official court documents. There is no way around this unless your BK is not reporting to your CR, and the banks dont see it. This would not work.

Secondly I too went through all this, and if your trustee is like most, they will not allow you to hold on to a car and add another. 1 car per family is acceptable in their eyes. And also according to them, you should have built in enough money into your schedules to be able to handle repairs out of your pocket. This is what they are going to want. And I was advised by my attorney that if at all possible, handle this on my own. Or alternatively buy a cheap car for a couple thousand that will get me through to the end of the BK. We decided to repair our van out of our own pocket. It was costly, but we didnt need to bring light to our BK and shake the tree so to speak. Its a better way to be, not making waves.

Now if you really need to replace your car, you can have your attorney file a motion to incur debt. It would need to fit into your budget and be VERY modest. No sports cars, SUVs or trucks. Most likely you will be only allowed to get some sort of economy car for like $100 a month. If you can get it fixed, I would do that. These are all my opinions and experiences, and I give no legal advise.