Cars during chapter 7 or 13

[Rjrl926]

We have two high car payments due to terrible credit and having been upside down on one of our cars. We have one car that’s 900 a month with very high interest and another at 1040 a month due to very high interest and it’s a lease through American Honda.

during consults with lawyers who want us to go chapter 7, the expectation is that we’d have to give up a car. The issue is my wife is home with our son whom was just born with a disability and health issues and i often travel for work throughout NJ/PA/De. We absolutely need both cars.

Inwas told in a chapter 13 even if the trustee rejects the car payment, that ultimately it’s up to me to affirm it? Any help is appreciated. We haven’t decided on a lawyer yet as we want to educate ourselves as much as possible here first

[shipo]

The best advice I can give is to interview three to five attorneys and ask your questions to him/her; there are so many moving parts to a bankruptcy, especially a Chapter 13, it will be difficult for us to give you good guidance. With that said, if you opt for Chapter 7 and surrender one or both of your cars, you should be able to buy something new(ish) fairly quickly following the discharge. The key here is to think small and inexpensive.

[justbroke]

A $1,040/month car payment is going to be a problem no matter how you slice it up. As shipo mentioned, you should obtain 3-4 more free consultations to get their take. A payment over $619/month is a "luxury" car and bankruptcy is the antithesis of luxury. In a Chapter 13, a trustee is not going to like either payment. A debtor simply cannot substitute their lifestyle at the expense of creditors. Unless you propose a 100% plan, a Chapter 13 trustee isn't going to like those payments at all.

You're going to need to think "small" and "inexpensive" at this point. Your payments for both vehicles are nearly $2,000/month. A payment of $1,200 a month for two would be pushing it. A Chapter 7 trustee doing their analysis, is going to say you have at least $800 in disposable monthly income (DMI) just between the vehicles. That's $48,000 over sixty months in a Chapter 13. That's a very juicy number.

Definitely get a few more free consultations. I don't see you keeping both vehicles at those prices.