Bankruptcy surrender questions

[paintedridge]

What is the name of your state? Wisconsin

We have filed a chap. 7 and we have our creditors meeting on 5/2/05. We are wanting to surrender our current truck that has a high payment and buy another truck with a lower payment. We are wanting to know when is the best time to surrender the vehicle and buy a new one. We don't want to have to worry about the bank coming after us and trying to get more money from us for the difference between the loan and the trucks value. We also don't want to worry about having to make payments for both vehicles. Also what needs to be included on the surrender paper work. Thanks

Laura

[bigun]

You should have done this before you filed. You don't need to try and finance anything until the bk is completed.
Whatever you do, don't reaffirm that truck.

[paintedridge]

we were going to keep the truck until they decided to be difficult and looked into doing something different. We have family who will help us get a new vehicle, just don't want to get stuck paying money on 2 vehicles.

Laura

[bigun]

In that case, don't reaffirm the truck and once the bk is discharged just tell the bank to come and get it. You'll not be on the hook for any deficiency balance.

[paintedridge]

Is it a problem to turn the vehicle over before the creditors meeting? Somebody said to wait until the meeting to prevent possible problems. I would just as soon get it over with and move on with my life.

Also will getting another vehicle, with help, be a problem to get the discharge to go through?

Thanks

Laura

[bigun]

I wouldn't be financing anything until the bk is discharged unless your lawyer says it's OK.
Sure you can turn it in prior to the 341 meeting. Did you list the payment as an expense?

[paintedridge]

Yes, we listed it as a payment and an asset.

Will getting a new vehicle before the discharge affect the result? The loan for the new vehicle would be a secured loan arranged by family.

Laura

[cinnerella]

WE are going thru a similar situation with vehicles. We have 3 on one loan and we are planning on surrendering all of them to get all of the CU stuff discharged(that lovely cross collateralization stuff again!). Because we need atleast one vehicle for work , our lawyer advised us to look now before filing(paperwork is in progress, we just need to finish paying for bk first) I have had a bad feeling about this since he told us to look now before filing. I know i should trust him, lawyer should know best, right? Would this look fraudulent, getting a loan right before filing, like within a week of filing.....if its even possible. Sorry to ride in on your coattails and ask my own question, it was just so similar, well except for the fact that we havent filed yet, and i was hoping i could keep this ball of a post rolling

[bigun]

First of all to Laura,

If you don't have a lawyer, you better get one . If you surrender the car now, the payment can't be considered an expense. That'll affect your disposable income.

Cinnerella,

The OP's situation is why you do that sort of stuff prior to filing. It's not fraud at all. Obtaining financing post bk is difficult and interest rates are insanely high. Just don't but or lease something like a brand new Lexis or BMW. Just get a reasonable ride.

[rich221976]

Thats exactly what my lawyer told me to do. Buy the replacement vehicle before filing. He told me to buy one with as low as a down payment as i could. I went to this one buy here pay here place, that i bought a few cars from. I got a 1998 kia sephia @ 2600, with only 200 down. Then i called the loan company to come get the other car (however i didn't get my last vehicle from the buy here pay here). I was way upside down on the car loan. I had a 2000 ford mustang, which i bought in 2001. Interest rate was 19.99%. I paid on it for three years @ 376.56 a month, and i still own about 10,000 on it.

Rich