Cramdown question (another one)

[walkthaplank]

It looks like we won't be filing til mid July, not happy but there it is. Where is the 910 days figured from? The date of purchase or the date of the first payment on the car?

Based on our purchase date we'll be over 910 days if we file in mid-July.

[HHM]

That is an interesting question. I would think it would be the date of loan inception, which would be the date of purchase.

[justbroke]

Based on your "contract date" so that's when you signed the loan documents for the car. In some cases, where you use a so-called BlankCheck, the date is usually when the lender gets the check back from the dealer (the BlankCheck).

From experience, when I purchased a couple of Mercury vehicles from Ford Motor Corporation (FMC), the date was that listed on the sales contract.

When I purchased a vehicle using a BlankCheck, it was a date after I actually purchased the vehicle. I assumed that this was when the BlankCheck was presented for payment.

[Flamingo]

This question was asked on this forum in the past. I believe the answer was when financing took place and the vehicle (title) was placed in your name.

[optimistic1]

In my district, the ruling is based on last financing date, not the original purchase date. So in my case, even though I purchased in 2005, I refinanced it in 2006, and the 910 day countdown starts from then. Unfortunate for me, but I'm past the 910 days now, so no worries. I'm sure the facts could be argued, but most attorney's are lazy, or want to charge you for special stuff like that. I thought it was their job the last time I checked.

[justbroke]

In my district, the ruling is based on last financing date, not the original purchase date.

This seems to vary by the State underlying non-bankruptcy law as to what refinancing does to the "purchase money security interest" it replaces. There are very few States that have this issue because most of them are smart, and just copied Florida's UCC or California's UCC.

So in my case, even though I purchased in 2005, I refinanced it in 2006, and the 910 day countdown starts from then.

What State/District are you in? I just want it for reference, because this will be the first State I've heard in which a refinance doesn't destroy the "purchase money" status of the loan.

Unfortunate for me, but I'm past the 910 days now, so no worries. I'm sure the facts could be argued, but most attorney's are lazy, or want to charge you for special stuff like that. I thought it was their job the last time I checked.

Well, if your State (underlying non-bankruptcy law) actually reads that a refinance doesn't destroy the "purchase money" interest, thereby replace it with a non-purchase money security interest, then that's just a shame!

From my readings, the only time a refinance may not destroy the purchase money characteristic of the original loan is if a.) it is made by the same lender, and b.) no new consideration is given (e.g. just a refinance from the same Bank). For those, the term is novation. But then again, there are State specific definitions around this too.