Can I buy a new car before I file? And keep it?

[GregZ]

I don't own a car. I'm filing 7 with a used car business involved. The bank/business credit line owns every single car I have. I will be walking after they take everything. I know I won't be able to get a loan for quite a while after this so I would like to go buy a new car so I have it over the next few years. Can I do this, and will I get to keep it. Looks like it will be Mercedes Financial doing the loan. Maybe Audi Financial.

[keepmine]

Just be sure you have a reasonable car note.
Don't show up financing a luxury auto on the cusp of a bk filing.

[AngelinaCatHub]

Greg, you are going into Chapter 7 and desire new debt? That is not a good way to use a "new start". Yes you could keep the car. Mercedes? Audi?

Why not pick the best old car off your lot, pay that part of the floor plan to the creditor as if you sold it to a customer. You would be ahead as your cost would be less without a profit margin.

We are driving a perfectly healthy 93 pontiac Grand Am police car with the paint shaking off. It looks like what it is, but it runs perfectly and we have had it four years. Good basic transportation.

I would like to be at your 341 when your Trustee sees this purchase and the type of car you wish.

I would advise you to think long and hard on this. 'Hub

[HakunaMatata]

I purchased and financed a car two months prior to filing. I hadn't had an auto loan in nearly ten years. A car is an absolute necessity in my area as is reliability. While I enjoy warranties, I refuse to purchase new. I explored reasonable Audi Certified A4s and my attorney said this wouldn't present a problem (this thought was shared by two consult attorneys).

Unable to find my "dream" car within the time constraints and budgeting I had set, I regretfully purchased a Saab (and traded in my A4). My trustee questioned me extensively about this purchase. I can only imagine his questions had I purchased the A4. (Of course, I wouldn't have had a problem explaining my former positive experiences with Audi, my reasonable payments, and the strong resale value -"entry class luxury" has nothing to do with my love for Audi).

I know some suggest refraining from debt. I simply didn't have cash to purchase a warrantied car outright as I had in the past. I have a very reasonable auto loan and I don't regret this debt. It is a basic necessity.

If I were you, I'd consult with local attorneys prior to making a purchase. I'd determine budget limits and I'd purchase a certified used vehicle instead of new. "Luxury" cars can present red flags (this will likely be highlighted if you have other red flags in your case). Be prepared to explain your reasoning for this purchase.

[GregZ]

I'm actually posting right now from the waiting room of my attorneys. I'm here to ask him this stuff. I'll post when I leave. The reason I want a Benz or Audi is I want a nice dependable car that I will be happy in because that's all I'm gonna get to have for yrs. I have a 790 credit score as of today so I can lease a C class or A4 for 400 a month. If I try and purchase any used car I will be close to that anyway.

[HakunaMatata]

Trust me Greg, I understand your reasoning!! The problem is that your trustee may not. Some buy luxury cars exclusively for the name. Others buy them for their reliability and technology (no ego involved). The trustee may regard your purchase based off the former and suspect your financial woes haven't been cured. You've obviously put thought into this and your potential payment doesn't appear to be exceedingly high (less than federal standard and I'm guessing you'll secure a good interest rate). Hopefully, your attorney will shed bright light on this.

[OhioFiler]

I would be concerned about incurring new debt of any kind AFTER you've consulted with an attorney regarding filing bankruptcy.

[frogger]

Looks like it will be Mercedes Financial doing the loan. Maybe Audi Financial.

I have caused myself enough problems in the past by accident, I sure wouldn't be doing something like this on purpose......

[OhioFiler]

I have caused myself enough problems in the past by accident, I sure wouldn't be doing something like this on purpose......

THIS made me laugh!

[GregZ]

Lawyer said I can "lease" a car. Because I can't have more than 7500 equity in a car. But by leasing it I won't have any equity. He said a 400 something a note is fine, doesn't matter what kind of car it is, they look at the dollar amount.