After 341 meeting, our lawyer presented us with this possibility.

[mhsaltz]

We sailed through our Chapter 13 341 hearing last month. However, an issue was presented to us by our attorney. The monthly payment is based upon all disposable income available to the creditors for the next 60 months(now 57). However, our 1st auto loan will be paid off with eleven months remaining of Chapter 13 trustee payments. The possiblity exists that the trustee will seek to amend our plan to add the amount of the car loan payment to the final eleven Chapter 13 trustee payments. Has this happened to anyone? Is this something that is standard practice?

[Bkq]

I have the exact same question with my situation....Does anyone know the answer???

[keepinitreal]

If you find out this will definitely happen, you could request to buy a replacement car shortly before the first auto loan is paid off. If you're given permission, you could get a new car loan for 12 or more months. Then your final trustee payments shouldn't rise, since you'll have this new car loan to replace the old car loan.

[NoTomatoCan]

Yes, it is pretty likely that your payment would increase (you now have more DMI). Pretty standard practice.

You could always include the vehicle payment in your payment to the trustee, that way the loan is spread over the life of your plan. Good part - you would likely get to reduce your interest rate down to your local Till Rate (typically between 5%-6%). Works nicely if you have a higher interest rate. Bad part is that you pay the trustee fee on that as well. This part is only bad if you are in a 100% payback or have some minimum amount that needs go to to unsecured (and are really close to that payback amount). Otherwise the % that goes to the trustee only impacts your unsecured creditors.

You could also do a step up plan. We have this for our 401k loans... You payment simply goes up once you are done paying on the loan. It is written in the plan as such and will happen automatically.

[Bkq]

Yes, it is pretty likely that your payment would increase (you now have more DMI). Pretty standard practice.

You could always include the vehicle payment in your payment to the trustee, that way the loan is spread over the life of your plan. Good part - you would likely get to reduce your interest rate down to your local Till Rate (typically between 5%-6%). Works nicely if you have a higher interest rate. Bad part is that you pay the trustee fee on that as well. This part is only bad if you are in a 100% payback or have some minimum amount that needs go to to unsecured (and are really close to that payback amount). Otherwise the % that goes to the trustee only impacts your unsecured creditors.

You could also do a step up plan. We have this for our 401k loans... You payment simply goes up once you are done paying on the loan. It is written in the plan as such and will happen automatically.

Just an additional question. On our Ch 13 - 100% payback - they included our car in the payments to the trustee. (Note: We had 2 years left on the payments - and included in those were our maintenace package that we paid $1,500 extra for when we purchased it). Question: When the car company finance company (VW) - was notified - can they cancel any of the maintenace part of the contract that was included as part of the package price. Note: I realize that this is a slightly different question - but thought you might have some insight. Thanks

[NoTomatoCan]

Just an additional question. On our Ch 13 - 100% payback - they included our car in the payments to the trustee. (Note: We had 2 years left on the payments - and included in those were our maintenace package that we paid $1,500 extra for when we purchased it). Question: When the car company finance company (VW) - was notified - can they cancel any of the maintenace part of the contract that was included as part of the package price. Note: I realize that this is a slightly different question - but thought you might have some insight. Thanks

Great question ~ and one that I will leave to others to answer better than I can, but will share my experience. I did the same thing. Knowing that I was likely going to file BK and I would not be in a 100% payback, I added a decent maintenance package to our vehicle purchase. Since my intent was to payback this extra amount, no issues. However, my attorney did offer to try to split the two parts of my loan (secured vehicle portion and unsecured maintenance contract). I said no (too much of a bother for no real benefit for me) but it leads me to believe that perhaps the car company could do the same thing in reverse. I may be totally off on this though...

[needanswers]

The Trustee at our 341 said to all people whose car loans were ending during the plan that he will seek that extra DMI once the car payments cease.