Cram Down....??? Can someone explain what this is?

[tn09]

I am new to this board and have been reading a lot of posting. Board is very informative since I am also looking to file Ch13.

I have been reading a lot about this "Cram Down" thing from people who have filed. Can someone explain what this is and what does it apply to? Most of the time, I see it being applied to auto loans is what I gather from reading this board.

TN09

[forgotten]

I am new to this board and have been reading a lot of posting. Board is very informative since I am also looking to file Ch13.

I have been reading a lot about this "Cram Down" thing from people who have filed. Can someone explain what this is and what does it apply to? Most of the time, I see it being applied to auto loans is what I gather from reading this board.

TN09

In a chapter 13 you can cram down a secured loan to the value of the collateral.

There are time restictions on how long you had to have owned the property. For example, an auto loan must be 910 days old. As well, you can not cram down a mortgage on your residence.

For example, if you owe $30,000 on your vehicle and it is only worth $20,000 you can "cram down" the loan and pay the $20,000 through your plan as a secured debt and the other $10,000 would be treated as unsecured debt.

[tn09]

In a chapter 13 you can cram down a secured loan to the value of the collateral.

There are time restictions on how long you had to have owned the property. For example, an auto loan must be 910 days old. As well, you can not cram down a mortgage on your residence.

For example, if you owe $30,000 on your vehicle and it is only worth $20,000 you can "cram down" the loan and pay the $20,000 through your plan as a secured debt and the other $10,000 would be treated as unsecured debt.

Thanks for the explanation! Can this cram down be applied to RV loan too?

[StaciMM]

You may have a hard time getting an RV loan thru the trustee, since its probably considered a non-essential item. Meaning you could give that up, free up more $ to pay your unsecured creditors.

For auto loans - I believe the time period is 2 1/2 years or 910 days. If you file before the loan is aged enough, its not eligible.

[forgotten]

Agreed. Unless you live in the RV and have no other primary residence the RV would be a non-essential item that you probably could not keep unless you were in a 100% plan, in which case a cram down would not apply as you would have to pay back all to unsecured, which would include the crammed down amount.

[tn09]

What is a 100% plan? Sounds like it is a plan that requires you to pay back 100% of what you owe.

I like to keep the RV if possible. I only have 3 more years left on the loan. Maybe I can reaffirmed the loan and keep it outside the CH13 filing. It would be nice if the bank that is holding the my RV loan is willing to negotiate my loan balance. I am sure they don't want the hassle of taking it back and having to deal with it at an wholesale auction.

[forgotten]

What is a 100% plan? Sounds like it is a plan that requires you to pay back 100% of what you owe.

I like to keep the RV if possible. I only have 3 more years left on the loan. Maybe I can reaffirmed the loan and keep it outside the CH13 filing. It would be nice if the bank that is holding the my RV loan is willing to negotiate my loan balance. I am sure they don't want the hassle of taking it back and having to deal with it at an wholesale auction.

Yes, that is where you are paying back 100% of all your claims. The problem with keeping the RV is that you would be paying XXX per month for it and that XXX could go to unsecured creditors instead of paying for a luxury item for yourself. You can ask several attorneys in your area on how it would be viewed in your district, but it is unlikely they will allow you to continue paying on it. You would be keeping a "fun item" at the expense of your other creditors.

[forgotten]

I would have went out and bought a cool RV before I filed for $1000/mo instead of paying the $1k/mo I am paying to unsecured creditors right now if that worked.

[newbie2]

What is a 100% plan? Sounds like it is a plan that requires you to pay back 100% of what you owe.

I like to keep the RV if possible. I only have 3 more years left on the loan. Maybe I can reaffirmed the loan and keep it outside the CH13 filing. It would be nice if the bank that is holding the my RV loan is willing to negotiate my loan balance. I am sure they don't want the hassle of taking it back and having to deal with it at an wholesale auction.

There aren't any reaffirmations in a Chapter 13. As others have stated, it will most likely be viewed as a luxury item in which the payment can be used instead to pay your unsecured creditors.

[Guest123]

We have 2 quads that were a year old at the time of filing that we were allowed to keep and got crammed down. We also know friends that were able to keep their RV in their ch13.
I would say it would depend on your case, lawyer and the trustee if you can keep the RV.
I got the same answers when asked on here if we could keep the quads.

[forgotten]

We have 2 quads that were a year old at the time of filing that we were allowed to keep and got crammed down. We also know friends that were able to keep their RV in their ch13.
I would say it would depend on your case, lawyer and the trustee if you can keep the RV.
I got the same answers when asked on here if we could keep the quads.

Yes, it really does depend. It would be right out in our district. Our judge has even ruled that you can not keep exempt luxury toys such as these even if they are already fully paid for.
I do not agree with that ruling, as that is one of the points of a Chapter 13, but no one has appealed it as of yet that I know of.