Advice on downgrading vehicle prior to BK

[azdebtor]

I have an '08 work truck that has a payment of $744 per month on a balance of $14400 for another 2 years. I have found a '07 used truck that will do the same work on which the dealer says the payment will be $387 per month for 60 months. After trading in and paying off my '08, the balance on the '07 will be $16000 at 16% (C paper.) I'm just trying to get out of the large monthly payment and was surprised that with 1+ years of unpaid CC my rate would only be 16%. Are there any ramifications I should be aware of by doing this pre-BK? Am I correct that if we end up in a Chap 13, that the interest can't be lowered or the value of the '07 crammed down because the loan isn't old enough? I just don't want to go into a BK with $10000 of equity and lose the truck to the trustee; plus I really need a lower payment.

Thank you for any advice available.

[debee]

I think you're doing the smart thing.

The only thing I can think of to watch out for is the lien. Even though you won't have any equity in the truck, you'll want to make sure the lien is perfected before you file (if you go chapter 7).

You won't be able to do a chapter 13 cram down because of the 910 rule, but you might still have a shot at a lower interest rate.

Best of luck to you.