Car outside of plan

[laurannm]

Lets say you are making car payments outside of your plan, and a relative offers to pay off your remaining balance as a gift. Do you have to notify the trustee so that they can amend your plan?

Thanks

[CindyLou]

First of all, how much money are we talking about...how many months into your plan?

If you notify the trustee to amend your plan you may as well flush the money down the toilet because your plan could go up as much as your disposable income increases ..

Is you interest rate on your car high? Why are you wanting to pay off your car? IMO, this would not be a very smart thing to do...unless you get clearance from your attorney. Otherwise you would just be better off keeping the cash as a nest egg to have for emergencies.

[laurannm]

We are talking about $14k total. I haven't filed yet (mid-July) but was just asking as a hypothetical. My parents have offered to pay for the car outright. Since we have a chance at a ch 7, paying for the car now would put the car at risk if a Ch 7 is successful.

My thought process was that we would use the current car payment as an expense when calculating plan payments, and then pay the car off maybe a few months after we were confirmed. Wasn't sure though if that would be grounds for plan dismissal.

Yes, the interest rate is a little high (10.9%). I would like to keep the cash instead but I was told by a moderator in a previous post that accepting any kind of cash gift before the plan was completed (and without notifying the trustee) could cause an issue.

I suppose though they could just make the payments for me instead of paying for it outright, at least until the plan is completed?