Auto loan after Ch. 13 voluntary dismissal

[BamaDad]

Hello. I filed for Ch. 13 2 1/2 years ago to try and save my home after a divorce. I eventually lost the home to foreclosure anyway. Today my attorney filed a voluntary dismissal on my behalf. An auto loan was also included in the plan. It has been paid through the trustee on time for these 2 1/2 years. The beginning balance on the loan was around $14,000 and is now around $7,000. The vehicle is worth about $6,000 according to KBB. My attorney said that there is a chance they will come looking for the vehicle and repossess. Can I not simply call them and start making payments directly to them now since the loan is current? I want to keep the vehicle. My attorney simply told me that she didn't know and pushed me out the door. Thank you for any insight anyone can offer.

[Lissy]

I would call the lienholder and explain your situation. Payments were being made through the trustee, that's no longer happening, can they please start sending you monthly statements so you can pay directly? They may ask for a copy of your dismissal paperwork. I wouldn't think it would be an issue, but you'll have to work it out with them now. They don't want the car back, especially if it's worth less than you owe. And if you're current on the payments, there's no reason for them to take it back.

[SMinGA]

You can probably start paying directly again. You will need to ask how much you need to pay to bring the loan current. Just because you made your scheduled plan payments does not mean your car loan is now current.

The complicated part is figuring out what you owe. Being paid thru your plan was probably not paying the amount monthly that your original contract called for. And it was probably at a lower interest rate - yet since the 13 did not complete they probably have the right to go back and charge their regular interest.

[justbroke]

Well, many car loans are crammed down in plans and you are actually "in arrears" during a Chapter 13. If your case is dismissed or converted (to Chapter 7), this could put you behind in payments. You can ask your current lender if it's okay to resume payments or if they'll fix it so that you're current. Getting a loan while in an active Chapter 13 is easier than getting one after a dismissal. However, your rates are going to be very high (high teens to mid twenties!).

As SMinGA wrote, there are many factors which probably actually have you "beind" in normal payments. The only thing you can do is to ask the creditor if they'll "re-age" the account. They may or may not. You're not in a good position.