Trustee picks price of cars?

[Bkman2]

I just signed to paperwork to convert my 13 to a 7. Attorney said everything looked go to move forward. He said that my income is -$1200 DMI and it would look better to the trustee if we put I'm looking to add $1000 a month to my income in the future so my DMI would only be -$105 a month. Said they would question how I have been paying the bills with no money (living off past commissions).

I asked about our cars (wife on both but she didn't file) and he said that in Nevada the chapter 7 trustees don't have a real interest in cars. I was told that they may just show no interest in them or they may want something for both or just one. Said I would have to wait until my 341 meeting to see what they want. Cars are the only assets.

Anyone hear of that before? I just don't want to go in and have them say "give me $5000 and that will cover it". Both cars are 7 years old. Under the 13 they put the value for both at $3200.

Only other thing is the one joint debt. Was told that if they try to collect from wife to work out a payment ($3800), something I was going to do anyways just to keep her credit good. But if I don't here from them then don't worry about it.

Beyond that everything else is just like my chapter 13. I don't really care about the BK being on my credit report because after 3 years most lenders don't care. I have a friend that filed chapter 7 about 3 years ago and he just purchased a home with an FHA loan and got an interest rate of 5.5%. Thats better than I got when I purchased years ago with a 750 fico.

In the end I think it's all about what gets you on your feet again. I have gone almost 2 years without one credit card and I don't feel the need to have one again. I hope to be discharged by December 2010 and start off 2011 with a fresh start.

[mrskal]

What is the Kelly Blue Book value of each car? What kind of cars are they. 3200 for both seems very low to me. I have a 7 year old toyota corolla and a 5 year old hyundai, they came in on KBB at 4300 and 3875 on the middle amount.

[Bkman2]

Attorney had me go to Carmax and get a printout of what they would pay for my cars. (Mine) 2003 Jeep Liberty 71K miles $4000, (wife's) 2003 Toyota 4runner 92K miles $10,000.

Attorney put in my case Jeep = $4000 minus non filing wife's ownership = $2000 minus wildcard = $1000 value.

Toyota = $7000 minus non filing wife's ownership = $3500 = exempt

When they comfirmed my chapter 13 case the judge changed my liquidation value from $1119 to $3200 and said it was for auto.

I was told that because I'm converting my 13 to a chapter 7 everything in the 13 stays the same and the trustee will look at my nonexempt items (cars) and let me know how much they want based off of the information in the chapter 13 confirmation paperwork.

I never heard of that, thats why I was asking if anyone else knew about it.

[mrskal]

I dont know anything about it. Wish i could help. I am curious as to what others say too. I know for a fact if I went to carmax,my value would be less that KBB, I may have to look into that myself, so I can use my wildcard exemption toward other things. Good luck to you.

[SMinGA]

Sounds like $3200 was used (in your ch. 13 filing) as the value of your equity in the vehicles after your exemption. If that was reasonable in the 13 plan, then your current liquidation value most likely would not exceed that. Might be a little lower since they have more miles and are ~6 months older.

$3200 would be low if that was the total value of the vehicles.

[angles]

We were told to use the low KKB wholesale value. Even then, we lowered the amount on one of our vehicles because it had a salvaged title. This direction was given from an attorney who is a trustee for our area. Different areas may use different methods, but bottom line is if you have solid proof (like a written estimate from carmax) you should be good.