Renegotiate Car Loan?

[madzkenz]

Any suggestions on negotiating with my credit union?
Currently I pay $923 w/3 years left and $700 w/5years left.
I have not officially filed yet but my attorney said unless I renegotiate these down to $500 each they will not approve my Chapter7.

[liz417]

Uhmmm, I don't know if the CU will negotiate, they are a "tough crowd"...

Those are high car payments, I can see why your attorney is a little concerned. Are you really attached to your cars, could you stop paying and save money and buy another good used cars before you credit tanks?

[justbroke]

Well, it's not so much they won't approve them, it's that they won't allow the payment over $489 each for them (over 60 months/5 years). Those would be considered luxury in almost any court in any Chapter of Bankruptcy.

I don't know any auto lender who would reduce the principal. None. You could try redemption, but with the balances you have on those vehicles, your payments would probably go up not down.

What are those vehicles, what is the balance, and what is the APR?

The thing I worry about, is if you submit with those car payments, the Trustee would probably file a 707(b) motion for dismissal, just on bad faith.

[fyi2]

now i am worried... my car payment is 700/mo (trying to redeem) 341 is monday... bad faith!!
schedule J is way negative.. this will help disproving bad faith..right?

[justbroke]

now i am worried... my car payment is 700/mo (trying to redeem) 341 is monday... bad faith!!
schedule J is way negative.. this will help disproving bad faith..right?

Is it way negative, because of the car payments. See where it starts to get bad?

[liz417]

oh, you've already file...

[aces67]

My car payment is $592 a month and the trustee never said anything about it.

Now I just have to decide if I'm going to keep it or not.

[madzkenz]

I doubt they would reduce the principal approx 30K on the first loan and 35K on the second loan. I would like to keep at least my truck due to it being used for work and I drive about 4K miles a month. I am hoping to sell this to my credit union as justification at least for the second loan. The first loan I have less than 3 years left , I hate to give it up now after paying $923 for over 3 years.

[justbroke]

My car payment is $592 a month and the trustee never said anything about it.

One new car, at $100 over is not much to look at. Especially if subtracting the $100 overage still leaves you negative disposable income.

Having two cars that have a combined payment of over $1,600 a month, will raise an eyebrow or two. The Trustees don't always care about a single car over by a nominal amount.

What gets interesting, is when the U.S. Trustee is looking at your case because you're over-the-median and/or are discharging around $100K or more in unsecured debt. That gets you on the radar.

If the Debtor's lawyer is worried about it... so should the debtor. This means that in the lawyer's experience, it could (not will) cause an issue.

I have not officially filed yet but my attorney said unless I renegotiate these down to $500 each they will not approve my Chapter7.

That statement is very telling. If the debtor has negative disposable income of -$500 or more... they are going to get a 707(b) presumption of abuse statement. Because, adding the $640+ difference between $489 x 2 ($980) and $1,600+... can put them into a positive disposable income situation.

[fyi2]

Is it way negative, because of the car payments. See where it starts to get bad?

Yes.. but still way (-2000) negative on J

[justbroke]

Yes.. but still way (-2000) negative on J

Sorry, got you confused with the original poster! I was responding to you, but in the "terms" of the original poster's case. Sorry.