Help!!! Surrender car??????

[Sastry]

Help!!! Surrender car??????

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Question: I am 2 years into my Chap 13 (payments are $575 for 3 years) and I have 2 car payments. Car #1 is a very cheap payment and I want to keep that car. Car # 2 sets me back almost $350 a month and now I do not need or want this car. A family member just gave me a great car for free!!!!

I called my lawyer and he said due to new BK laws, if I surrender my car, the Car Company would go to the courts and would have the car loan taken out of my Chap 13 and I would be on the hook for the whole balance. Has anyone ever done this or know if this is the case? Thanks!

[NoTomatoCan]

What your attorney was trying to tell you is that if you surrender that vehicle then your Disposible Monthly Income (DMI) will increase by that $350 car payment since you no longer have that expense.

So essentially you will pay the trustee $350 more a month to your unsecured creditors without that vehicle to show for it.

I am assuming that you are paying for this vehicle outside of your payment to the trustee and you are not in a 100% payback.

Do you possibly have other expenses that could offset this?

[Sastry]

Not Really, But we are confirmed for a 36 month BK plan. If My last Chap 13 payment is scheduled for Oct and we surrender it in August what will happen? At the end of my 13 I still have over 2 years left to pay on the car and it will need about $1000 worth of work. What do you think? thanks!