new car

[325Falcon]

We will file CP7 in about 60 days. We have 2 cars that are upside down. Our car exeption is $4000. One of the cars has some issues IE: Tranny may go anytime.

Before we file.

If we go out and trade this car in for another one rolling over any acess $$$ from the orginal car into the new one and end up with a lower overall monthly payment albeit a longer term and still being upside down in the loan.

Would this be OK or would it be BAD BAD BAD BAD BAD!!!!

[lrprn]

If we go out and trade this car in for another one rolling over any acess $$$ from the orginal car into the new one and end up with a lower overall monthly payment albeit a longer term and still being upside down in the loan. Would this be OK or would it be BAD BAD BAD BAD BAD!!!!

When you file, as long as you reaffirm the new car loan, you should be ok. Of course, I'm assuming you are planning to get a good "new to you" reasonably priced car, not a new Mercedes or BMW!

Ask your lawyer before you do anything. He/she will know if doing a car purchase this close to filing is going to raise a red flag with your court's trustees.

[325Falcon]

Rather than buy a car before we file and have to roll over any "upside down" amount still owing on the trade in car. Would it not make more since to let the current car go back and discharge the debt then think about getting a car? This way I am not rolling over bad debt needlessly.

Any thoughts?

[CindyLou]

I agree!! Don't trade an upside down car! They will be rolling over the negative equity into the new loan when you could be discharging the negative equity in the bankruptcy. Anyone else have any comment on this? The only problem I can see is that some car loans will require you to have a trade. For example, Cap One Blank Check does not, but Roadloans does.

[klux]

We purchased a new vehicle on 9/15 (how we managed to get the loan, I have no idea), and it was only 10.9%. I plan on letting my gas guzzling SUV get surrendered when I file on 10/2. The trustee might question it, but my payment will be $75.00 less, and I'll save at least $250.00/month in gas. I don't think I could've did a better thing. That's just my opinion, not sure if it's going to raise a red flag or not.

[colleenbean]

I might be doing something similar. I just gave my atty my stuff to review-i have an old honda that's beat up, so I was thinking I should try and get a new car before my credit is totally shot. I am waiting to hear from my atty about this.