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Should I sell my vehicle before I file?

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    #1

    Should I sell my vehicle before I file?

    So, here is my dilemma... I still owe $17,000 on my Jeep, but am currently behind.

    According to KBB it is worth $16,000 +/-. Nolo's How to file Chapter 7 said not to use KBB, but to rather use www.nadaguides.com, as it would give a more accurate estimate. According to NADA, It would trade in around $18,000-$19,000.

    My theory - correct me if I am wrong - is that if I can sell the vehicle to a dealership prior to filing my Ch 7 BK, I can pay off the remaining balance of the loan, and have a thousand or so left over, then I could purchase a 'beater' to get me around. (All of this, of course, if I could get more than I owe). If I don't do this I will have to surrender the vehicle; I cannot re-affirm as I am still looking for a new job after being laid off in June...

    Would that look fraudulent to a Trustee?
    Last edited by elle20905; 11-19-2009, 04:14 PM. Reason: correcting a typo
    Life is the one lesson that must be learned, yet cannot be taught... I find myself trying to complete this chapter and move on to the next as quickly and painlessly as I can...
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    #2
    Nothing wrong with that plan. It's pretty standard advice to get your transpotation needs taken care of before you file.

    Comment

      #3
      Plenty of people do the same thing.

      Wanna be careful on one point though.

      Will losing the payment cause your DMI to rise to a level that forces you into CH 13?

      That is the only possible concern I could see.

      Good luck,

      -dmc
      11-20-09-- Filed Chapter 7
      12-23-09-- 341 Meeting-Early Christmas Gift?
      3-9-10--Discharged

      Comment

        #4
        Ok, its good to hear I wouldn't be seen as commiting fraud if I do it that way...

        Deadman - I am currently unemployed, and do not qualify for unemployment... I went from a little over $4,000/mo to nada... Which is why I'm filing BK now. I am in the process of being hired at Starbucks as a barista (my experience is as a payroll and HR specialist), which shows how little work is out there...

        Thanks again for the responses!
        Life is the one lesson that must be learned, yet cannot be taught... I find myself trying to complete this chapter and move on to the next as quickly and painlessly as I can...

        Comment

          #5
          Many people get rid of their car payment and get a "beater" that is paid for before filing for bankruptcy. Make sure that you can cover the "beater" in your exemptions, and you should be fine.
          You can't take a picture of this. It's already gone. ~~Nate, Six Feet Under

          Comment

            #6
            Originally posted by backtoschool View Post
            Many people get rid of their car payment and get a "beater" that is paid for before filing for bankruptcy. Make sure that you can cover the "beater" in your exemptions, and you should be fine.
            Thanks for bringing that up! As I have not fully thought this plan through I hadn't even thought about the exemption yet...
            Life is the one lesson that must be learned, yet cannot be taught... I find myself trying to complete this chapter and move on to the next as quickly and painlessly as I can...

            Comment

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