910 rule

[Pinkrose]

Hi, I'm new here and have a questions. My husband and I are filing chapter 13 and the lawyer mention to use a 910 rule on my vehicle which falls in that category. Could someone explain it too me.

thank you.

[HHM]

If you have owned your car for 910+ plus days...
AND
If you owe more on the car than the car is worth...
THEN
You can pay the car off inside the chapter 13 at the current market value.

For example, if the car is worth $10,000, but you owe $15,000; if you have owned the car for more than 910 days, you can divide that $10,000 by the number of months in your chapter 13, and pay the car off that way.

[lrprn]

Hi, I'm new here and have a questions.

Welcome to BK Forum - glad you found us!

My husband and I are filing chapter 13 and the lawyer mention to use a 910 rule on my vehicle which falls in that category. Could someone explain it too me.

Here's an excellent explanation of the 910 rule posted here in the forums last February by HHM, one of our most excellent moderators - http://www.bkforum.com/showthread.php?t=35316

Take a look at the whole thread, and if you still have questions, post them here. We'll help you sort everything out.

[andy158]

I will try to explain it as my lawyer did for me. You have to have been making payments on the vehicle for at least 910 days in order to cram the payments down and include it in your bankruptcy. In my situation I still owed twice what the car was worth. The balance was $10k going in. In the plan it was "crammed down" i.e. the car was determined to be worth $5k and the payments worked out to be $100/mo for the duration of the plan. I was making $375/mo payments and still had three years to go. Very upside down on it. The trustee disburses payments out of your plan to the bank it is financed through. You get to keep the car and any remaining balance is discharged after your case has ended. This only works for primary vehicles and not "luxury" items such as boats, rv's or motorcycles.

[Pinkrose]

thanks for the replys. My balance on my car is 18,000 and book value is about 9,000. My monthly payments are 672, do I continue to pay that amount outside of plan. Oh yes I have the car for 4 years now.

[bklawn]

thanks for the replys. My balance on my car is 18,000 and book value is about 9,000. My monthly payments are 672, do I continue to pay that amount outside of plan. Oh yes I have the car for 4 years now.

Hey do you have to be current to include the car in a chapter 13?

[HHM]

Hey do you have to be current to include the car in a chapter 13?

No, you need not be current, you can pay the missed payments in the chapter 13. But, you need to file your BK before they repo and sell the car (in most cases, that will be after 2 missed payments).

[andy158]

thanks for the replys. My balance on my car is 18,000 and book value is about 9,000. My monthly payments are 672, do I continue to pay that amount outside of plan. Oh yes I have the car for 4 years now.

If it is included in your plan, the payment would be the 9k (current value) spread out over the duration of the plan plus interest. My interest is 5%. For a five year plan the payment may be about 180/mo estimated. Your lawyer would give you the exact amount. These payments would be disbursed from your monthly trustee payment.