Trade in car, but do not get payoff.

[mrobinette]

My attorney is horrible. If I trade my car in to get another one, what happens with the 2000 that is left to pay it off. Does it go to unsecured or do I have to roll it into the new loan? Will lenders negotiate lower playoffs?

[djransom]

My attorney is horrible. If I trade my car in to get another one, what happens with the 2000 that is left to pay it off. Does it go to unsecured or do I have to roll it into the new loan? Will lenders negotiate lower playoffs?

It will roll in to the new loan.

[mrobinette]

What if I sell my car outright and don't trade it in?

[df04527]

Not sure but i would think you would need to get enough for it to pay it off and receive clear title. Not sure how that works in a 13 though. Others will chime in.

[LadyInTheRed]

You can't transfer title to a buyer until the lien is removed by the lender.

If you are in an active 13, you need to get trustee's permission to incur debt to buy a new car. Also, depending on what's in your confirmation order, you may need the trustee's permission to sell your car.

We may be able to make some suggestions for dealing with your attorney. Can you elaborate on "My attorney is horrible?" Have you talked to him/her about this? If so, what did he/she say? Or, is this a case of your attorney not returning calls/emails? If so, now long ago and how many times did you try to contact your attorney?

[mrobinette]

I have asked them all of these questions before. After many attempts to get them to answer, they keep blowing me off. This has been a few weeks. They originally told me that the amount left over after trading in will be put in unsecured, so I didn't do anything with my car before we filed last year. Now they are saying they aren't sure. They aren't sure if I will get my tax Edmund, not sure if they can negotiate a different payoff, just not sure on anything. There is a week I between all correspondence with them.
I am also not sure I couldn't have filed a chapter 7 and been done with all of this.

[LadyInTheRed]

There are many things that an attorney can't tell you for sure. Whether you get to keep your refund probably depends on what the trustee decides when he sees your tax return. Don't count on keeping the refund and you might be pleasantly surprised. If your attorney negotiates with a lender, he can't guaranty what the outcome of the negotiation will be.

It's unclear to me whether you only discussed the car with your attorney before filing or if you also discussed it after filing. When I first read your email I assumed your plan has been confirmed and the plan included retaining the car? Is that true? How much is the car worth? Why do you want to get a new car now? Can you make your current car last for the rest of your Chap 13 if you have to?

The fact that you filed a 13 without understanding why you didn't file a Chap 7 tells me you have been too passive in your bankruptcy. It is your responsibility to make sure you understand what is going on in your case and to ask your attorney questions until you do understand. If you said to your attorney "I want to get rid of my current car and finance another one. Can I do that and what needs to be done to make it happen?" and you didn't get an answer that you understood, you need to keep asking questions.

It is possible your attorney is horrible. But, based on the vary vauge information you have provided, I'll reserve judgement until we know more about your situation. This forum may be able to help you understand things, but you'll need to provide some specific information. If you answer my questions about the car situation, we'll all try to help you figure that out in this thread. If you want to try to understand why you are in a 13 and not a 7, we'll need more information on your financial situation at the time you filed. It's would be better to start a new thread for that question.

[mrobinette]

I have discussed it with him both before and after. Before we filed was when they said it would be added into unsecured. After was when they switched it to it has to be rolled in to the new loan as well as they are not sure-they would have to check. That was 2 weeks ago.
I trusted my attorney and now realize maybe his laid back nature wasn't the best idea. When we filed we made barely above the median limit for Ohio. We were behind on our mortgage and car and they said both would be lost in a chapter 7- again I trusted my attorney. We now make 20,000 above the median limit, so I am assuming we are unable to switch with thew amount of money.
We are only a little over a year into the plan. The car is only worth about 2000, but my payoff is 5000. I want to get rid of the car because it has 175000 miles on it and many things are starting to go wrong. So, no I am not able to keep it for 4 more years.

[LadyInTheRed]

Okay, let's try to keep this thread to the car question and the other thread to the conversion question.

What does your petition say about your intentions regarding the car? Was the plan to surrender it or pay it off within the plan?

If you were going to surrender it, the lender could repossess the car and file an unsecured claim for the deficiency. Might that have been the context of that answer by your attorney?

If you answer the bold question above, it will be easier to help you. But, I do have one obeservation. If your annual salary has increased by $20,000 since you filed your BK and the trustee is not already aware of it, asking the trustee to approve the financing of a car may open a can of worms that will end in a higher payment plan.

It is not unusual for an attorney to not know the answer to a question right away. They need to review your file and then may have to review the law or talk over any unusual aspects of your case with other attorneys. And they often have other priorities they have to tend to first. But, two weeks should be enough time to get back to you. Call your attorney and remind him you are still waiting for an answer about how to replace your car. Squeeky wheels get the grease. Or at least get your file closer to the top of the "to be greased" pile.

[mrobinette]

I honestly don't know what my paperwork says. I know that I discussed with them before filing that I would need a new vehicle. I just don't know if it was laid out.
My husband has had a whole year of working at the same hourly rate he made when we filed. They take anymore and we won't be able to pay our utilities. I have to redo the budget for them to show them what We can afford which does make me nervous.

[LadyInTheRed]

If you don't have a copy of your petition, you should get one. You also should have a copy of the order confirming your plan.

It's hard to make suggestions regarding your car without knowing more about how it was treated in your plan.

You say that you were only slightly above median at filing and are now $20,000. The fact that your husband's hourly rate is the same doesn't matter if the household income has increased. It sounds like maybe he is working more now? Or is the increase income yours?

I have to redo the budget for them to show them what We can afford which does make me nervous.

So, did your attorney ask you to redo your budget when you asked about geting a new car? If so, he's probably waiting for that before advising you on your options.

It doesn't sound to me like your attorney is horrible. Either he is waiting for further info from you are is slow in responding. Be persistent in following up with him. Once you have a new budget together, it may be a good idea to make an appointment to sit down and talk about the changes in income and your need for a more reliable car.