What happens to our cars in CH13?

[S2008]

We have 3 cars, all of them paid off. Family van is ~$20,000, the other two are old cars, may be $2500 each.

What is the best thing to do before starting the BK process? Will they take away and sell all the cars or have us make payment for anything above the exemption?

I'm assuming it would be hard for us to qualify for Ch7 unless our income drops significantly.
1st home: -80K upside down
2nd home: -80K upside down
CC debt: 100K
House hold income: 150K/yr, family size 5

[chloe0724]

It's all about the amount your state allows for exemptions. Also, your creditors have to be paid back from your payments as much as they would if you had liquidated all your assets. So if you have more value in your cars than your state allows, you may have to up the payment amount if you want to keep them.

[S2008]

Will it benefit us if we trade-in all three cars and take out two decent cars with minimum downpayment? The idea being to minimize our disposable income by having two car payments and almost no equity in both cars? BK filing, if it happens, will happen after 1 year at least. I'm trying to plan for it.

[chloe0724]

I have seen that reccomeded by many peoples attorneys on this forum. But I would ask your attorney first before making any major changes.

[S2008]

Thanks Chloe for your quick replies. Best of luck in your 13 :-)