Mr Bill

[Billyo57]

Is it typical for a person filing Ch 7 to reaffirm or whatever means available to finance a used car?

[shipo]

I'm not quite sure what you're asking; do you have a current car loan you're asking about reaffirming, or are you thinking to apply for a car loan before or after you file for Chapter 7?

[Billyo57]

I need to improve my transportation. Yes ( am asking if yhis id customary

[shipo]

Applying for a car loan immediately prior to a Chapter 13 is considered standard operating procedure; for a Chapter 7 I'm thinking the lender would challenge that in a hillbilly heart beat.

justbroke, can you chime in here on this one?

[justbroke]

After the major 2005 changes to the bankruptcy code, known as the BAPCPA of 2005, may attorneys were reluctant to tell debtors to purchase a car prior to filing. For some reason many courts thought that when an attorney did that they were a debt relief agency and fell under stricter terms such as not encouraging debtors to incur debt.

As shipo writes, it's pretty much standard for debtors to purchase a vehicle before going into a Chapter 13. As for a Chapter 7 I would think that the conditions are similar. But I would think that one should purchase a vehicle weeks before filing. I suggest at least 6 weeks prior to filing. In my case I suppose I was lucky as I replaced a vehicle just a couple of weeks before filing. At the time that I filed, the car wasn't even registered or a title issues by the county. I don't know if that would cause issues and why my mere suggestion is to do it as early as possible.

First, I would think the major issue is whether you're forced to reaffirm the debt (because the car is new). Second, if you tried to discharge that debt the creditor could -- as shipo eludes -- seek to make it non-dischargeable. Third, if you lobbed in negative equity from a prior vehicle, that's actually a bad thing (because you could have just got rid of that old negative equity). And finally, can you afford the new vehicle after the Chapter 7.

Whether or not your credit is strong enough to get a good rate is an entirely different discussion.

[Billyo57]

I guess I didn't investigate enough prior to filing ch 7. I have just had a rating around 540 for the past 25 years and want to sincerely reestablish credit. Now I hear all about how I "should have bought this" and I should go get a car.....with no credit?
Verizon emails me and says they will be writing off my bal due for my S10 (-$430) and wife's Moto (-$60) ! One to 2 billing cycles. So I needed to upgrade wifes phone and son's who is moving to Georgia and needs a fully functional phone. So I went online and upgraded by paying the $60 remaining on Motorola phone and got 2 phones coming. I had upgraded last January to the S10. Should I expect scrutiny over this $243 deal. I also paid my $277 monthly bill 4 days before.....I just don't know what I am doing

[Billyo57]

So after our case is filed, who will tell us how and when to finance something (car, motorcycle, RV for retirement)....,Are there do's and don't's before the court date and then will they be different after the court date and then again after discharge? I am blind here Thank you so much.

[justbroke]

When we talk about buying a dependable vehicle before filing, it also means that we're talking about buying a dependable vehicle before your credit has tanked. The reason this is one of those nice thing to do before filing is because credit is guaranteed to tank upon filing. Creditors are more stingy after filing and you could end up paying higher rates. But, for Chapter 7s, you could have a good credit score without 6 months of filing to refinance or buy a new car.

(For Chapter 13s, especially those lasting for 5 years, a dependable car is almost a must have.)

Billyo57 no one will tell you when to acquire debt. That's entirely up to you and what you plan to do with your fresh start.

The bankruptcy dos and do nots are simple; don't move money around, don't payoff relatives, don't sell anything, don't run up credit on the eve of bankruptcy, and for the love of all things holy, don't try to hide money, property or assets.

After filing, still don't do anything but live your normal life. Pay your rent, work, fix your car, etc. Just don't make any big changes. After the discharge, and especially after the case closing, live your life they way that you want to live your post bankruptcy life. If that means running up credit card debt again, do so but with knowing that you can't get another Chapter 7 discharge for 8 years. Or, as most learn, try to be more careful with credit.

Use the bankruptcy as a learning experience and start to budget. Hopefully the same things that brought one to bankruptcy, whether it was medical, divorce, major incident, lawsuit, or poor money management, we learn from it.