Car was totaled

[ozzy866]

Our SUV was totaled on New Years eve-everyone is OK. My insurance company is giving us $6500 - $500 deductable= check for $6000. We went out looking to replace the SUV and found a comparable one for $8000 which includes taxes and fees.
We have quit paying on our mortgage until our mortgage company does a remod or we include it in our chap 7. Man remods are crazy!
Is it reasonable to use our next couple pay checks and some christmas money to make the $2K difference?
Thanks
Oz

[BobMango]

How do you plan to protect that asset once you file? That amount is over the exemption amount for just about any state that I'm aware of. You will need to use a wildcard exemption to cover the difference between the auto exemption amount and the value of the asset.

I'd hate to see you purchase this asset only to lose it in the bankruptcy.

I think the wiser move would be to find a reliable vehicle for less than your insurance payout and close to the exemption amount you have available. You need to start looking realistically at the difference between genuine needs and wants. Speaking for myself, I used to talk myself into luxury purchases by justifying them as necessities.

[ozzy866]

only car

this would be our only car and we are a married couple. Soes this matter?
Thanks
Oz

[AngelinaCatHub]

this would be our only car and we are a married couple. Soes this matter?
Thanks
Oz

No it is your state exemption for a single car that is available. Here in FL (cold FL) it is usually 1k 1 vehicle. What state are you in?

http://www.thebankruptcysite.org/bankruptcy-exemptions/

'Hub

[AngelinaCatHub]

The best exemptions I have noted is TX. A car to a licensed driver and the mules horses and 12 cows two guns all exempt together to a 42K amount. But, still here in cold Florida 1K 1 car. Just not fair. Check your state on that link I put up. Check other states as there are gross differences per state. 'Hub

[ozzy866]

We won't have anything else that is really worth any money. Maybe just regular household goods and a couple firearms.

We need a depedable car and we have always got what we paid for. We need one good car for our household.
It is a SUV 2002 with over 120K miles.
Fincial info on the car is in earlier post.a
I didn't think this to be any type of luxury type buy?
Will the trutee be tripn?
Will they take and sell the car or dismiss the case?
Our 341 is in a little over a week.
Thanks
oz

[ozzy866]

we are in Indiana.
It looks like 8K in tangible goods??????
Oz

[ozzy866]

nothing is really said about auto like it says in Florida.
Again we are in Indiana.
Oz

[AngelinaCatHub]

We won't have anything else that is really worth any money. Maybe just regular household goods and a couple firearms.

We need a depedable car and we have always got what we paid for. We need one good car for our household.
It is a SUV 2002 with over 120K miles.
Fincial info on the car is in earlier post.a
I didn't think this to be any type of luxury type buy?
Will the trutee be tripn?
Will they take and sell the car or dismiss the case?
Our 341 is in a little over a week.
Thanks
oz

No they will not dismiss you. Your state is generous in exemptions. If you are a little over, and become as asset case, the Trustee will give you an opportunity to purchase the equity back. I doubt you will have any problem with the exemptions you have. 'Hub

[StartingOver08]

So you filed BK before you totaled the SUV? I see that you filed Ch 13 and now you have converted to a Ch 7. What did your attorney say about the insurance payout proceeds and the BK? Did he specify what would happen to the funds or tell you the max amount you can exempt? Your situation is more complex than the average filing because of the Ch 13 and the conversion to Ch 7. Maybe one of the others will know how that impacts what you can buy, if it does. I would be careful about owning a vehicle free and clear in a Ch 7 that is not exempted on your petition.

[AngelinaCatHub]

So you filed BK before you totaled the SUV? I see that you filed Ch 13 and now you have converted to a Ch 7. What did your attorney say about the insurance payout proceeds and the BK? Did he specify what would happen to the funds or tell you the max amount you can exempt? Your situation is more complex than the average filing because of the Ch 13 and the conversion to Ch 7. Maybe one of the others will know how that impacts what you can buy, if it does. I would be careful about owning a vehicle free and clear in a Ch 7 that is not exempted on your petition.

Not a lawyer here, but I would think that the insurance proceeds would be exempt for this reason, (insurance and proceeds are exempt anyway) the payment was to "make him whole" as it is needed to be used for and only for the replacement. The paperwork can be amended to reflect the transaction and the replacement car. In essence nothing has changed as the original car and the payout are equal in values. Only my opinion but insurances are exempt. 'Hub

[ozzy866]

yes we were in a 13 and got it dismissed. Filed a 7. our original truck a 99 tahoe was shown as exempted property(owe nothing) on 7. Car was totaled after filing the 7. Pay out from insurance will be tomorrow and want to get the 2002 suburban. We will need to fin 2K more to get newer truck which will be our only vehicle and we are filing jointly.
Thank you for the heads up!
Very informative here.
Oz

[jribe]

yes we were in a 13 and got it dismissed. Filed a 7. our original truck a 99 tahoe was shown as exempted property(owe nothing) on 7. Car was totaled after filing the 7. Pay out from insurance will be tomorrow and want to get the 2002 suburban. We will need to fin 2K more to get newer truck which will be our only vehicle and we are filing jointly.
Thank you for the heads up!
Very informative here.
Oz

why not just get a small loan on the vehicle so you're not over your exemptions? Even a "loan" from a family member- that's notorized..

[AngelinaCatHub]

why not just get a small loan on the vehicle so you're not over your exemptions? Even a "loan" from a family member- that's notorized..

He has already filed and cannot get a loan from anybody without the Trustee's permission. That may become a bit of a problem. At the 341, he will be asked if he came into any money and even a gift would not be good. He needs to check with the lawyer on that one. Since he has filed already, he may use his own funds and pay in installments if the car dealer would hold the Title, let him have the car with temp tag, and get him paid in the month the temp tag is in effect. Another option is a promissory note which is not considered a loan or new debt (I'll have to think on that one) to pay after the discharge or put a deposit on the car and buy it after discharge. HMMm it gets a bit complicated now that I think about this more. It would be better if he could get a 6K car exact value replacement. 'Hub

[jdcat]

ozzy-

You keep saying "we" are in Indiana, does that mean you and your spouse? Married couples can double the wildcard for a total of $16,000 in exemptions in Indiana.