ch.13 auto lease expires in 2 years

[JBB]

We are planning on filing ch. 13. We see a lawyer this week. My wife's auto is leased and the lease is up in about two years. With the option to refinance the rest and own the vehicle. She will want to keep it. Will the bank allow us to refinance the remainder of the lease during our ch. 13? If they won't refiance it, she won't have a car and we need it as we have 3 kids. I have a small Jeep but we also need her car because we have three boys. Does anyone know anything about this situation?

[JBB]

It's a smartbuy, not a lease. Anyway. I looked at my contract and it said if the auto is involved in a bankruptcy, they won't refinance the balloon payment. So it looks like I'll be loosing the car in a couple of years. What can I do now? My wife has to have a car. What a mess!!! I don't know what we're going to do.

[chpxiii]

Start saving for a car that you'll have to get in a couple of years.

I know it sucks, but this may be your own option. Unless you can get someone to loan you theirs.

[6ftladycop]

It's a smartbuy, not a lease. Anyway. I looked at my contract and it said if the auto is involved in a bankruptcy, they won't refinance the balloon payment. So it looks like I'll be loosing the car in a couple of years. What can I do now? My wife has to have a car. What a mess!!! I don't know what we're going to do.

I did not know that about SmartBuy. So there is no way that you will ever be able to lease another vehicle from the place you got the first lease, even if you continue to pay them on time or get financed for the vehicle once lease is up if you would like to keep it? You are right, that sucks cause I have two little ones also. I am going to start saving, but what if you want to buy a car and some major dealership is willing to allow that? If you can not finance the leased vehicle that you want to keep because of the bankruptcy, I guess you have to have good timing and save a lot of money so that you will be able to buy immediately once lease is up....is that about right?

[6ftladycop]

Start saving for a car that you'll have to get in a couple of years.

I know it sucks, but this may be your own option. Unless you can get someone to loan you theirs.

In other words, we will have to buy a car from a dealership thats willing to allow it after BK and have a very good down payment?

[rrockinggramma]

as you haven't filed yet, perhaps one option would be to go get another car now, purchase it and get financing in place. Then surrender the leased vehicle in your chapter 13 plan. That way you have vehicles that will get you through the plan and you won't be stressing about losing it in 2 years, which sounds like would happen anyway, unless you save up enough cash to buy it out at the end of the lease, which would be very hard to do while in a chapter 13.

[6ftladycop]

as you haven't filed yet, perhaps one option would be to go get another car now, purchase it and get financing in place. Then surrender the leased vehicle in your chapter 13 plan. That way you have vehicles that will get you through the plan and you won't be stressing about losing it in 2 years, which sounds like would happen anyway, unless you save up enough cash to buy it out at the end of the lease, which would be very hard to do while in a chapter 13.

I already file a chapter 7, I still have the leased vehicle, its up in 2 years and I signed a Lease Assumption Acknowledgement with GMAC and the let me keep driving the car which I need for my 2 children with autism and my job which is far away. I was so worried about all the talk on making major purchases and then filing bankruptcy that it never occurred to me to buy a vehicle while my credit was still good...get financed and then turn the leased vehicle back in. I saw it two ways...1. leased vehicle was already on my credit report so I do not know how I would have pulled off getting another car with my salary and 2. what about the early termination of a lease agreement...I sure did not need someone asking me for thousands of dollars and I was considering bankruptcy.