Need car

[bajaboy1]

Long but will try to keep short...
Filed 13 in 1/2011. Have a lease car that was up in 10/2012. Need to get trustee to ok purchase of new car. Lawyer looks at finances(paystub) before submitting request. Notices I took out a 401k loan. I honestly didnt think it was a no no, but find out it is. Fairly large, $900 month. I also lost a side business in June that was losing $500 per month (came out that way when doing taxes...). Got a raise at my full time job of 20% since filling back in 1/2011. Needless to say, they advised me to let the plan fail and start over since my payment would now be huge and could get a car inbetween filing again.
Question is I still need a car. The plan will fail after I miss a couple payments I suppose, around 60 days. Lawyer says get a car then and will stick it in new BK. What will my credit report say after letting the plan fail? It sure won't say discharged. Very concerned this is not going to be easy getting a car after plan gets dismissed, or what ever it would be called.
Sorry for the long wind, but needed to get the facts out to get a proper response.
Thanks.

[LadyInTheRed]

Your credit will be terrible and you will have a high interest rate, but you will be able to find somebody willing to give you a car loan. If you are going to file a new Chap 13, the rate won't matter. It will probably be reduced to what is called the "Till Rate". Even if it isn't, what you don't pay in interest will go to unsecured creditors.

Welcome to BKforum! I hope you will stick around and keep us informed on how things go for you. Not only will it be useful for others, but we may be able to help keep you from making another mistake. The biggest rule of being in a Chap 13 other than to make your plan payments on time is to consult your attorney before making any significant financial moves.

[bajaboy1]

Thanks for the welcome.
What does the credit check say after BK fails? Just wondering who in there right mind would give a loan knowing I'm going to file again. Very nervous I'm gonna be without a car.

[LadyInTheRed]

I think the credit report will show your BK as dismissed, but I'm not certain. Maybe somebody else knows.

There are dealers who do make high risk loans. They are sometimes referred to as "buy here, pay here" dealers. The risk is why the interest rate is so high. It's a secured loan, so they can always get the car back if you don't pay. Their advertising is target to people who have filed bankruptcy. I just googled "Kentucky bad credit car loan" and got plenty of hits for dealers and lenders advertising that they lend to people with bankruptcy on their report. One lender even guarantees 100% approval "any and all credit is accepted." I'd go to dealers before filling out any online applications.

[ccmisery]

I have been told to buy a new car before filing, problem is my FICO score was hit with some late payments due to a job loss, was over 680 now is 523, my interest rates would be absurd. I also have a lease which will end in under 2 years. I even have looked at financing my lease, but my interest rate is way too high. Have you investigated that route?

[LadyInTheRed]

I have been told to buy a new car before filing, problem is my FICO score was hit with some late payments due to a job loss, was over 680 now is 523, my interest rates would be absurd. I also have a lease which will end in under 2 years. I even have looked at financing my lease, but my interest rate is way too high. Have you investigated that route?

...If you are going to file a new Chap 13, the rate won't matter. It will probably be reduced to what is called the "Till Rate". Even if it isn't, what you don't pay in interest will go to unsecured creditors.

.

[ccmisery]

.

How does that "Till Rate" work? Let's say I get a car at my current FICO 523, file 13 in 3-6 months?

[HHM]

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