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    #1

    High Car Payment and UST

    Does anyone know the answer to this - my attorney is on vacation this week!

    I have a high car payment of 850 per month. I am a Realtor and I use my car to show clients listings. I sell primarily in the higher end space. The US Trustee's office sent me a request for information on when I started leasing the car, why, and how much I write it off for taxes (I write of 50% every year).

    Can the trustee object to my car payment? Yes, I know it is high, but I can't drive my clients around in a junker. I asked my lawyer about this when we first met and he thought it wouldn't be a problem since it is a expense for my job.

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    #2
    Yes, your car payment will be an issue. Take a look at this memorandum in the Middle District of FL that discusses the implications of a high car payment in BK. http://www.hillsboroughbankruptcy.co...pAllow.me3.htm

    You could offer to reaffirm the debt, then renogtiate the payment with the creditor - see if they will drop the payment. It is possible. If they don't you can surrender. You don't have to get a junker. There are a lot of vehicles between junker and Mercedes (or whatever you drive). The measure of a successful agent is the number of closings - not the car they drive.
    Last edited by StartingOver08; 09-04-2009, 05:41 AM.
    Filed CH 7 9/30/2008
    Discharged Jan 5, 2009! Closed Jan 18, 2009
    I am not an attorney. None of my advice is legal advice in any way..

    Comment

      #3
      The TT can object to anything he/she wants.

      It seems the TT is only asking for supporting documents or statements to allow your $850 payment. Most likely he'll assign $425 to your personal vehicle ownership expense and the balance is business related. I don't see a problem.

      Now if you were some schmuck who delivered pizzas for a living it might be an issue.
      Well, I did. Every one of 'em. Mostly I remember the last one. The wild finish. A guy standing on a station platform in the rain with a comical look in his face because his insides have been kicked out. -Rick

      Comment

        #4
        There are plenty of options between an $850/month car payment and a junker. It doesn't have to be one extreme or the other. The real question is going to be, can you afford it? I don't buy the argument that you "need" a luxury vehicle to sell a home. I have never heard of anyone refusing to buy a house because the realtor showed up in a Camry.

        Comment

          #5
          Originally posted by hereforinfo View Post
          There are plenty of options between an $850/month car payment and a junker. It doesn't have to be one extreme or the other. The real question is going to be, can you afford it? I don't buy the argument that you "need" a luxury vehicle to sell a home. I have never heard of anyone refusing to buy a house because the realtor showed up in a Camry.
          Hey now! To some of us a Camry would be a luxury car!
          Well, I did. Every one of 'em. Mostly I remember the last one. The wild finish. A guy standing on a station platform in the rain with a comical look in his face because his insides have been kicked out. -Rick

          Comment

            #6
            Originally posted by hereforinfo View Post
            There are plenty of options between an $850/month car payment and a junker. It doesn't have to be one extreme or the other. The real question is going to be, can you afford it? I don't buy the argument that you "need" a luxury vehicle to sell a home. I have never heard of anyone refusing to buy a house because the realtor showed up in a Camry.
            Oh, and I agree with that. In 20/20 hindsight I should have gotten a cheaper car, but the attorney said it wouldn't be a problem.

            I sell to the 3 to 10 million range in CA, so image is an issue. (I am from the East Coast and in SoCal image is really a big deal)

            Comment

              #7
              Originally posted by hereforinfo View Post
              There are plenty of options between an $850/month car payment and a junker. It doesn't have to be one extreme or the other. The real question is going to be, can you afford it? I don't buy the argument that you "need" a luxury vehicle to sell a home. I have never heard of anyone refusing to buy a house because the realtor showed up in a Camry.
              I have to agree with this statement 110% !!!

              To say that anything less than a car with a $850/mo car payment would be considered a "junker" is absolutely ridiculous Let's not forget that we're not talking about someone who's obviously able to AFFORD this type of payment -- we're talking about someone who's filing for BANKRUPTCY!

              Personally, I think it would be the biggest crock if the trustee didn't question such a high payment JMO
              Filed 8/2009
              Discharged & Closed 11/2009
              Now the rebuilding begins....

              Comment

                #8
                Originally posted by brokerealest View Post
                Does anyone know the answer to this - my attorney is on vacation this week!

                I have a high car payment of 850 per month. I am a Realtor and I use my car to show clients listings. I sell primarily in the higher end space. The US Trustee's office sent me a request for information on when I started leasing the car, why, and how much I write it off for taxes (I write of 50% every year).

                Can the trustee object to my car payment? Yes, I know it is high, but I can't drive my clients around in a junker. I asked my lawyer about this when we first met and he thought it wouldn't be a problem since it is a expense for my job.

                There was a case on this board just a week or so ago where the trustee dismissed the case for presumption of abuse and totality of circumstances based on high car payments. Here is the link:

                Ch.7 dismissed due to "abuse" AND "totality of circumstances" - Bankruptcy Forum Chapter 7 13 341 Meeting Credit Collections
                http://www.bkforum.com/showthread.php?t=43840&highlight=totality+circumstances
                Everything related to Chapter 7


                The payment on "luxury" items (by definition of the trustee) cannot be considered legitimate expenses in a chap 7.
                You can't take a picture of this. It's already gone. ~~Nate, Six Feet Under

                Comment

                  #9
                  Originally posted by OhioFiler View Post
                  Hey now! To some of us a Camry would be a luxury car!
                  Some might even deliver pizzas in one.
                  No Asset 7 closed 11/09

                  Comment

                    #10
                    Originally posted by OhioFiler View Post
                    Hey now! To some of us a Camry would be a luxury car!
                    True, and it doesn't even have to cost $850/month.

                    Comment

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