QUESTION
Can I buy a new car before filing for Chapter 13?
Asked on Aug 29th, 2011 on Bankruptcy - Tennessee
More details to this question:
I was unemployed for 16 months due to my company closing down. With that happening, I got too far behind in my bills. All my debt is unsecured debt and I was thinking of filing for chapter 13 so I could at least pay some of it back. I just recently got a good job that comes with a nice salary. I need a car and a dealership has offered me an opportunity to finance a new car. If I get a new car and file bankruptcy will the fact that i got a new car effect my bankruptcy? Will the car be taken away if I file a chapter 13? I do need a good car as I will be travelling a lot for my job. I just dont want to get a car and file and then maybe not be able to file and then get sued by my credit card companies or file and then have the car taken away and not have any car. Any help would be much appreciated. Thanks.
1 ANSWER
Bankruptcy Attorney serving Burbank, CA
Partner at
Law Office of Mark J. Markus
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It is completely appropriate for you to purchase a vehicle that you need prior to filing a Chapter 13 case. In fact, it is MUCH better to do so before you file, rather than after. As long as the payments on the vehicle are reasonable, you can use the amount to deduct from the budget you'd otherwise have to pay to your unsecured creditors.
You should of course consult with a bankruptcy attorney in your area before doing anything, so they can properly evaluate all the relevant facts, but there is nothing wrong with getting a solid vehicle that will get you through at least the term of your Chapter 13 plan.
Mark J. Markus, Attorney at Law
Handling exclusively bankruptcy law cases in California since 1991.
http://www.bklaw.com/
bankruptcy blog: http://bklaw.com/bankruptcy-blog/
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Answered on Aug 29th, 2011 at 9:19 PM