Filing Chapter 13, Inheritance and my Car

[dcraig54]

We are currently filing a Chapter 13 in Indiana. My husband had lost his job permanently in Aug of 2009 after being on a temporary lay off for 6 months. In the meantime in May of 2009 I found I was inheriting some money from my dad, so when I got it I paid all doctor, hospital bills etc off. I took a little of the money for myself and both some much needed appliances and furniture. When my husband found out he was permanently without a job we decided to try to sell our home which never sold in this economy we had moved to a different area so he could find owrk and paid the house payments plus rent in order for him to find a job which he did in less than 30 days. He cashed in his retirement which wasn't much and we moved with what I had left from my inheritance and the retirement paid house payments and rent as long as we could. As of December we could no longer make the house payments and in March the bank agreed to do a short sale which ran out JUly 2010. The bank has taken entirely too long as we had requested a deed in lieu 3 times but with it being an FHA loan they said this is the way it had to be done. 2 weeks ago we decided to see a lawyer to see what our options were and they suggested a Chapter 13. I figure knowing this banks reputation they would try to foreclose on us. I was thinking of surrendering my car which I had never been late on a payment and my husband is keeping his truck. The lawyer has asked me about the inheritance and said I would most likely have to show where the money went, which it was a year ago when we were paying our bills no matter what. I know they just want us to show we arenot hoarding any money, if I was I sure wouldn't be doing this. I am confused I need my car and I don't really want to give it because I can't go out and buy another one if I want to just save the money and pay cash. I am not sure what to do. Does anyone have any suggestions I am calling my attorney after the holiday to find out. I know it will raise the amount that is planned.

[lrprn]

In Indiana there is no specific auto exemption (see http://www.bjosephdavis.com/indiana-...w-1167639.html ), but you are allowed $8000 as a wild card to protect your real estate or tangible personal property (including cars) that you want to keep after filing up to that amount. How much equity does your husband's truck have (equity = loan value minus truck's current market value)? Is the $8000 going to protect other assets besides your cars?

You need to ask your lawyer to explain exactly why you have to surrender your car. Keep asking until you understand the situation clearly. It's important that both of you understand why recommendations are being made by your lawyer and how they impact your overall filing.