New Car; High Interest. Is lender told to lower rate?

[ArizonaCh13]

[Nicollette]

When a filed my Ch13 in May of 2007, I had my car for two years with an interest rate of 22%. My attorney fought for me and got it lowered to 8%. I later surrendered it because it was no where near worth what the lender would have got.

[BigJohn]

We are in Arizona. We bought 2 vehicles in 2008. In our plan, the interest is 0% but then we haven't been approved yet.

[TooMuchCredit]

My understanding is that if the principle can be paid off in the term of the plan than they can potentially get the rate lowered. Attempting to do that within my plan, but I have yet to be confirmed.

[rrockinggramma]

if your car is a part of your chapter 13 plan (paid for by the trustee, then the trustee will set the interest on the car) If you pay your vehicle outside the plan, then you will pay the higher rate. To include our car in our plan we had to be in arrears. Talk to your attorney about including it. My interest went from 24 percent down to 6 (per the trustee)

[BigJohn]

We were current on our vehicles but they are inside the plan.

[CH33 Paralegal]

A different interest rate can be proposed, but it doesn't mean that the case will be confirmed that way. The creditor could file an objection to the proposed interest rate and potentially compel the court to side with them. Maybe they wouldn't.

It would kind of be not really in YOUR best interests though if an attorney proposed the high interest rate though to start. If it doesn't get objected to, then it's fine....so you want to start out at a reasonable rate, like maybe 6 or 8%. I think 0% is a slap in the face of the car creditor. The creditor should have every right to account for the time value of money. On top of that, you're keeping the asset that is tied to the debt. 0% is bad faith in my opinion.