Not sure what to do? car totaled while awaiting discharge papers

[Lynn12]

Hi everyone. Our bk is wrapping up. Our trustee closed his case on 02/15. The court was notified and I've been waiting for the discharge papers. It seems to have been held up by 30 days extra because the notice stating I had completed my plan was returned to the court by 2 of the creditors.

Anyway, while in the bk, I saved to buy a decent vehicle to replace my aging van. I did that about 6 months ago. (that was a great day for me!!)

Fast forward to this afternoon when my parked vehicle was destroyed by some lady. (no way it won't be totaled)

So my questions are:

-Do I have to notify the lawyer or trustee of the fact I'll be getting a check from the ladies ins. company?

-If the settlement is not enough to find a new vehicle, do I have to get approval from the trustee to finance the extra amount?

I'm seriously bummed at the notion that all my hard work of saving could go down the tubes because some lady couldn't keep control of her car.

Any help would be appriciated.

[justbroke]

-Do I have to notify the lawyer or trustee of the fact I'll be getting a check from the ladies ins. company?

If the vehicle was "exempted" in the bankruptcy and the Trustee report of no distribution abandoned the property, the discharge will take care of this. You may want to touch base with your attorney to be certain.

-If the settlement is not enough to find a new vehicle, do I have to get approval from the trustee to finance the extra amount?

No. This is a post-petition event and you don't need approval. However, some lenders will require a notice from the Trustee or an actual discharge before they'll lend. It's silly, really, but there are some which require a letter.

I'm seriously bummed at the notion that all my hard work of saving could go down the tubes because some lady couldn't keep control of her car.

Well, let's just see how the insurance adjuster deals with this. I would hope that they at least repair it to an operating condition and in as good condition as it was prior to the accident. If the vehicle is still safe and operable after repair... just hang on to it longer so you can continue to save!

[Lynn12]

Thanks so much for the quick reply.

If the vehicle was "exempted" in the bankruptcy and the Trustee report of no distribution abandoned the property, the discharge will take care of this. You may want to touch base with your attorney to be certain.

The vehicle we owned when we filed had no lien on it and was older. I saved up cash and traded the exempted vehicle in, along with the cash, to buy this vehicle outright.

No. This is a post-petition event and you don't need approval. However, some lenders will require a notice from the Trustee or an actual discharge before they'll lend. It's silly, really, but there are some which require a letter.

This is a relief. Thanks so much for clearing this up for me.

Well, let's just see how the insurance adjuster deals with this. I would hope that they at least repair it to an operating condition and in as good condition as it was prior to the accident. If the vehicle is still safe and operable after repair... just hang on to it longer so you can continue to save!

Unfortuantely, there is no way it is getting fixed to a safe condition. She plowed into at about 55mph, never hit the brakes. The framed is split along with the rear axle, the drive shaft is dangling, the transmission is leaking, the gas tank is ruptured, brake lines are leaking...... The poor thing is defiantely toast.

Once agian, thanks so much. You have defiantely helped.

[justbroke]

What you write defines the insurance term "totaled" perfectly. From what I know, whenever the frame is compromised, the car is totaled. Hopefully, the blue book value is enough to get another similar vehicle. Worst case, should you need to finance, it may be wise to use the "entire" insurance proceeds as a down payment so that your Note is small.