Car Payment and Expenses

[firefly]

We are just starting our Chapter 13, hasn't even been filed yet. Our attorney advised us to try and get a new car, or one a year or two old, before we actually file. He gave us a dealership to try. They couldn't get us a loan.

My question is, since we won't have a car payment, are we still allowed the full auto expenses for the used car that we do have? We would need to start saving for another car, since we have a lease car that goes back in December. We don't have to replace it right away, but would like to be able to save towards something used and are worried about not being able to because of the Chapter 13 payments.

[Ckacrum]

Awsome question since we are going ch13 and we have one car going into the plan and 2 older cars outside the plan.
You still get Vehicle Operation Expenses for your area for the cars you own. My area it is up to $183 for 1 vehicle. Now am i going to get the full 183 for 1 or 366 for 2 or more, i'm unsure. I'm dang sure going to have include it in the plan!





The older cars could die anytime now and i'm wondering something.
If say both suddenly died and I have no Vehicle Ownership or Lease Expense in my plan because I don't currently have a loan outside the plan, how am I supposed to get another vehicle by means of financing?
The paralegal gal who is going to do our expense's seems to think It'll be no problem asking the trustee in our town for permission. Righttttttttt. Where's the money going to come from? Our food budget, where!

[lastalchaa]

car expenses

Hi Im slightly new to all of this and gettign ready to file...am I correct when reading this that there is an allowance of what your monthly payments can be???

[Ckacrum]

http://www.legalconsumer.com/bankruptcy/means-test/

Try this if you havent. Enter your zipcode and try using the means test. It gives you around 489.00 for vehicle ownership for up to 2 cars, trucks or van's. Also gives you allowances for your area.

[optimistic1]

Yes you will still be allowed the expense for your means test, regardless of its age.

[LimpDisc]

In Colorado it actually varies by district in my filing area. Some judges will not allow the vehicle ownership expense deduction ($489) on the means test unless you have a car payment. We only had one car payment, so we had to purchase another car for that second deduction. We didn't want to take that chance of losing that standard deduction. Plus we needed a newer car too.

[justbroke]

The ownership allowance (which is $489 nationally per car), is not allowed for unencumbered vehicles in all Districts. That is to say... it depends on which District you're in.

Some Florida Districts, for example, only allow a $200 allowance if the car is unencumbered (no loans) is at least 6 years old or has 70,000 miles or more.

[firefly]

We live in Michigan. I guess I will have to put a call into the attorney. We will need a new car eventually, so I was hoping to use that money to save for a hefty down payment, but if we have to put it back in the plan, that will be a bit difficult. Plus, the cars we will be driving our old and who knows what will go wrong with them mechanically. Such fun!

[walkthaplank]

Local rules prevail. At the 341 we attended there were more than one couple up there where the wife didn't work and was told flat out that they were objecting to the second vehicle expense. In my area also they did not let you have that exemption on an unencumbered car. I would say check with your lawyer, but I noticed another thing at the 341 we attended.... the lawyers really don't know too much and often times just try to get things through hoping they are missed.

[justbroke]

Local rules prevail... but I noticed another thing at the 341 we attended.... the lawyers really don't know too much and often times just try to get things through hoping they are missed.

I agree!