cram down of vehicle

[becky20]

So I had my 341 back in August. I got a letter that the credit union was disputing the amounts we came up with for our cram-down of our cars (have had them more than 910 days). This issue is not yet resolved, my attorney is dealing with it (says he is anyway). In his last email to me the other day, he says that the credit union is missing the point in regards to a cram down as to fair market value. He says since we've had the vehicles more than 910 days we are "eligible" but not "entitled" to a cram down, and that this issue may have to go to a judge for a valuation hearing if they can't resolve it.

Anyone hear of this before? Seriously? I thought that it was cut and dry in bankruptcy law - that we have had the loan for more than 910 days, and therefore it could be crammed. This is the first I've heard that we may not be entitled to it.

Any insight anyone could give would be great. I'm beyond ticked...

Thanks!!

[StartingOver08]

Do you have any other debt with this same credit union? Sometimes they add some or all of the balance from a cc to the vehicle debt without telling you. Did you check your amortization to see if it came out right? (before the cram down number). Most attorney's are good at legalize...but do not do math. Check your own math.

[justbroke]

Anyone hear of this before? Seriously? I thought that it was cut and dry in bankruptcy law - that we have had the loan for more than 910 days, and therefore it could be crammed. This is the first I've heard that we may not be entitled to it.

Yes, I just went through two of them. (And, I'm a pro se filer.) One of them they never responded to, so I've prepared an Order on that Valuation... no problem.

The second vehicle is actually a purchased within 910-days, but not purchased for personal use. The Creditor has responded and they are objecting to the valuation. This now goes before the Judge.

This is absolutely normal. Your motion to value is just that... a motion to a court to allow you to set the value on the vehicle. The judge can allow the valuation based on a.) no response from the creditor or b.) a short trial where both you and the creditor present evidence as to the value.

Totally normal, especially with Ford and GMAC who love to play games. So long as you used a recognized guidebook (Kelly Blue Book, Black Book, Edmunds.COM, NADA Auto Guide), you'll be fine!

No worries! Most judges just look at the private party value in NADA anyhow.

I will also add to what StartingOver08 posted. Sometimes, Credit Unions cross-collaterize things. For example, they'll cross-collaterize your credit card with your car. Just gives them something extra to go after.

[Flamingo]

We had two vehicles (3 years old, 5 year loans on both) crammed into our Plan. Our attorney advised us that he added in some extra interest so there should be no problems from either bank. There wasn't. So he utilized blue book value plus some interest "to keep them happy" if I remember his exact words correctly. Credit Unions are tough when it comes to BK. Hopefully your attorney can get this worked out for you.

[becky20]

thanks all - ugh, what a total pain!!! We did have a credit card that is included in the BK from the credit union as well as a 2nd mortgage (we're keeping the house and still paying on that). We used KBB and we used the middle amount - the highest (private party I think) and not the lowest (trade-in). We valued it in good or fair condition, not poor. The CU submitted the value based on the highest value and put it as excellent condition (which even the site says less than 5% of cars fall into that category, especially when we're talking several years old...

What a headache. Sure makes me never want to use a CU again!!! Don't ever plan on getting into this situation again but man, sure has turned me away from them for sure!

[StartingOver08]

Becky20 - call the CU. Talk to the BK dept. I just did this on the vehicle I am keeping and we negotiated a good deal. They reduced the balance owed, they removed the cross collateralization, they reduced the interest rate to 5%, they extended the amortization 2 months and I skipped one months payment in the agreement (due to the milage and the age and condition of the car - and the fact that I asked for it).

You have to negotiate directly with the BK dept. Not all BK depts are equal. I could not do anything with another vehicle that I have and have to surrender it - so it depends directly upon the policies/proeedures of the particular lender. But I found the CU to be much more willing to work with me than the other lender - which is a bank.

[becky20]

Becky20 - call the CU. Talk to the BK dept. I just did this on the vehicle I am keeping and we negotiated a good deal. They reduced the balance owed, they removed the cross collateralization, they reduced the interest rate to 5%, they extended the amortization 2 months and I skipped one months payment in the agreement (due to the milage and the age and condition of the car - and the fact that I asked for it).

You have to negotiate directly with the BK dept. Not all BK depts are equal. I could not do anything with another vehicle that I have and have to surrender it - so it depends directly upon the policies/proeedures of the particular lender. But I found the CU to be much more willing to work with me than the other lender - which is a bank.

Hmmm, should I do this even though the attorney is supposedly working with them on this? Should I ask my attorney before I call them?

[StartingOver08]

Call your attorney's office - they ususally DO NOT negotiate the terms of the cram down, just the actual legalize in the document (two entirely different things). Attorney's review the document to make sure you are covered, but they expect you to do the negotiation. Check your attorney's office first just in case yours is the unusal attorney that does negotiate the balance and terms.