I'm about 99% sure my wife and I are going to file a BK early next week. Our Toyota lease is on the verge of repo in a few days. We also have another vehicle financed. Luckily, I was given a payed-off car as well. We are going to need at least two vehicles.

We are definitely letting the financed vehicle go back, and we have options on the lease:

1) Reaffirm it to keep it
2) Try to get another vehicle now, quickly before the BK, then let it go back
3) Let the lease go back in the BK, then try to get another vehicle

I've heard Ford won't work with you after a BK, but I've heard Toyota will, except I wonder how Toyota would feel about me letting a lease through them be IIB?

Does it matter to lenders if it's a Ch. 7 or 13 ?

Has anyone had a good experience dealing with a manufacturer or finance company right after a BK? Things aren't looking good right now on getting financed, unless we save a few thousand dollars for a few months and get a POS.

Most automotive credit applications you sign, have some sort of verbiage that you are not considering/contemplating filing a BK petition.

Essesentially no difference in a BK7 or a BK 13 except the time frames involved from the inception to the discharge date.

Would it still matter if the new vehicle isn't IIB? In other words, I could see if you went to get a new vehicle knowing that you're going to file BK and included that vehicle in the BK. My intent was not to get a new vehicle financed just to let it go back or reaffirm it in a BK.

The financed vehicle payment is eating us alive. The lease payment we can deal with. What they want to charge me for mileage overages in about 10 months is a different story. I just don't want to let both vehicles go back in the BK and then be stuck with only one vehicle and not be able to get my DW something to drive.

Please understand I'm not judging you, but if you are having extreme difficulty right now that the vehicles are on the verge of being repossessed, it may be extremely difficult if not next to impossible to be able to get another loan. This may be reflecte in a current view of both your credit report and your auto enhanced credit score.

I'd imagine a lender would insist you trade one of the open auto loans should you be approved and that could be a problem if you owe a great deal more than the trade vehicle is worth. The new payment may not be financially feasible for you.

Well it's looking more and more like I won't be able to get a different vehicle right now regardless. For reasons you mentioned, lates, charge-offs, and debt to income, primarily. We've been in this catch-22 for a while now. Sell the car -- and we can't get another one. Keep the car -- and the payment eats us alive.

I think it's going to be best to try and file BK before the Toyota lease is repo-ed, then reaffirm it in the BK. Then just deal with the mileage overage when the time comes.

I mainly wondered if anyone has had luck getting financed right after a BK and who with.

OP should contact a competent BK attorney. OP faces a dilemma faced by many that one needs a "fresh start" which from a money management point of view ideally means surrending the auto as the obligation i.e. loan balance is more than the car is worth.

The problem of course is that one (with high probability) needs transportation and while in the midst of the BK proceeding one can not get auto financing (at favorable rates)

(Not recommended, but one can visit the website 722 redemption dot com for INFORMATIONAL PURPOSES only regarding auto financing in the midst of a BK proceeding)

OP also has the problem of having a LEASE i.e. basically renting (the ownership rights at the end of the lease are probably of minimal value) versus a LOAN i.e. OP owns the car but pledges the loan with the car.

If it was an auto loan then (need to check the court rules) then an option (more difficult as the lender probably can use the retail value) would be to reaffirm the car for what it is worth which is probably less than the loan balance.

I definitely would avoid the situation of "dealing with it later" with regards to overage miles as BK is designed to GIVE ONE A FRESH START which means starting over with no debt.

I would definitely avoid going the plan of :

2) Try to get another vehicle now, quickly before the BK, then let it go back

Said approach is likely to get one in an objection to discharge hearing on the grounds of fraud.


The best (no good course of action exists) would be to get a reaffrimation agreement (problem is that you want to do more than a reaffrimation agreement as you would be going from a lease to a loan) such that the purchase price of the car is its current WHOLESALE (another problem is that the lender probably would have to agree to do this. The BK court is not as likely to approve a cram down under these circumstances under the new BK law) price instead of the RETAIL price. (RETAIL price is defined as the price you would be paying at the dealership)

Within a few weeks of your filing you'll find your mailbox stuffed full of auto financing offers.
Read carefully, watch the rates and don't buy more than you are extremely comfortable with.

Probably.

The problem is getting auto financing in the MIDST of a BK proceeding. Competent F&I without a doubt can get one AFTER a BK discharge (although a downpayment may be required and the terms may not be very attractive) auto financing.

If you are in the MIDST of a BK proceeding then VERY FEW lenders are willing to extend one an auto loan.

My attorney seemed confident we can do a "cram-down" on the financed vehicle or reaffirm for actual value instead of retail. Maybe he was just being optimistic. I'm in AL if that makes any difference.

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2) Try to get another vehicle now, quickly before the BK, then let it go back

Said approach is likely to get one in an objection to discharge hearing on the grounds of fraud.
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Please don't misunderstand about this. I wasn't contemplating doing anything dishonest and I don't want to "start over" with a BK under false pretenses. What I meant was try to get another vehicle financed now, before we file BK, then let the LEASE go back, not the vehicle I just got financed. That would defeat the whole purpose.

We first talked with attorney about a ch 13. The problem with this, even if we get actual value for the vehicle we have a loan on, the payment now is $575 a month. I am not paying anything right now on my charged off accounts. However, adding on what we would have to pay on the consolidated payment including the reaffirmed vehicle, the new payment would be around roughly $700 a month. The reason for the increase is, of course, having to pay some back on the old accounts. A good deal of it is secure debt...furniture and a ring. That's not going to help us any because it's more money than we're paying right now! So it doesn't seem feasible under a 13 to NOT let the financed vehicle go back. That leaves the leased vehicle, on which the lease should end around May or June of next year. That means I won't have debt right now on the mileage overage, but in about 10 months from now, which hopefully by then we'll be in a much better financial situation to come up with the money to pay for a mileage overage.

Then we talked about a ch 7 which is looking like we may be able to do since my DW hasn't worked in quite a while (she also has a judgment which would get her wages garnished or she would've went back to work before now) and my income has been for the both of us. What I would ideally like to happen is let the lease go back, reaffirm the loaned vehicle for actual value, which is about $4k or $5k less than we owe, also get actual value on the items we bought with the secured debt, and get us a much more affordable payment on all of this than what we're currently paying. Ideally...


By in the midst of a BK and after a BK discharge...

Does "in the midst" mean only while we're in court proceedings or the entire time we're in repayment? I thought a discharge was years after the BK began and you're out of repayment, right? So essentially, we wouldn't be able to get anything financed for years from now.

Your BK attorney (I am assuming that your attorney SPECIALIZES in BK) is going to give the definitive advice. Every jurisdiction has different rules and Federal BK court is specialized so the "run of the mill" attorney who does not SPECIALIZE in BK is not a good choice. (Even more so with all the new BK laws)

If your attorney believes that he can cram-down the wholesale value vesus the retail value then that is likely to be the best course of action. (Again I am not an attorney let alone having extensive knowledge of BK laws and with that caveat said the Nolo Press Book on Ch 7 BK leads me to believe that the lender can try to insist on retail versus wholesale value)

I suspect that Chap 7 is much preferable to Chap 13.

If the lender objects i.e. insists on retail value then most likely a reaffrimation hearing will be needed and your BK attorney should be able to give you an idea of the likely outcome. Some BK judges have information sheets so that BK attorneys are likely to know the outcome. Also a BK attorney should know how a particular judge is likely to rule on a contested matter.

With regards to future auto financing, "in the midst" is defined as being in BK that has NOT been discharged. If you are in the midst of BK then F&I is likely to have an extremely difficult time in getting you auto financing.

repo is it diffcult to get capone blank check with discharge repo.

???????????? don't understand your post.