Chapter 13 Bankruptcy Auto Loans

Find Local Guidance for Negotiating Car Loan in Chapter 13 Bankruptcy

It could be possible to cram down unpaid principal balances as well as get interest rate lowered on your auto loan in chapter 13. Such a move could enable you to slash monthly car payments drastically during extremely difficult financial times.

Autoloansforeverydriver can help you to get connected to qualified and experienced lawyers online who can guide you during your effort for cramming down car loans while in chapter 13.

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2 Important Guidelines for Keeping Your Car When In Chapter 13 Process

Normally, chapter 13 rules allow debtors to keep their properties but it is mandatory for bankruptcy filers to pay portion or all of their debts through a sustainable monthly payment plan approved by the chapter 13 “Trustee” who oversees the case.

Nevertheless, there could be a couple of things which you need to consider as follows:

How To Repay Your Car Loan While In Chapter 13 Bankruptcy Proceedings?

Under chapter 13 bankruptcy proceedings, debtor proposes a favorable monthly repayment plan, which is spread over 3 to 5 year duration, for repaying part or all of his unsecured debts. Once approved by the bankruptcy court, debtor must start making payments to “Trustee” who will then distribute dues to all creditors including auto loan lender. Debtor will be able to keep the car as long as he pays installments regularly.

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How To Repay Your Car Loan While In Chapter 13 Bankruptcy Proceedings?

You may wonder as to how we can help you in getting monthly payments on car loan during chapter 13.
Here is some vital information pertaining to the same.

  • Pay off the car in Chapter 13 – As per chapter 13 plan, you will be required to repay all your car dues. Bedsides, you can also pay back auto loan debt directly to your credit by maintaining regularity of monthly payments so as to avoid Trustee’s commission.
  • With older cars, “cram down” the loan to the value of the car – If you purchased a vehicle over 2 and half years back then you need to check whether if your car’s value is less than the unpaid principal loan balance. Cram down could be possible if car value is equal to loan dues.
  • Reduce the interest rate to the Till rate – You also have the option to get interest rate reduced under chapter 13 car loan settlement procedure. One of our competent experts could be able to tell you more regarding the manner in which such a proposition can be achieved.
  • Surrender the car – Your last option is to consider surrendering your car so that your auto loan debt gets wiped out instantly. This might be a much better alternative over other options rather than struggle to make monthly car payments on a continuous basis.
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