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kicklaw40, Attorney
Category: Bankruptcy Law
Satisfied Customers: 21
Experience:  I have been a bankruptcy attorney since 1998 and have handled hundreds of bankruptcy cases successfully.
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If youre upside down on a vehicle thats in a bankruptcy plan

Resolved Question:

If you're upside down on a vehicle that's in a bankruptcy plan and start having problems that require about 3,000 to repair. Can this vehicle be sold for under what's owed and traded in for another vehicle?
Submitted: 4 years ago.
Category: Bankruptcy Law
Expert:  kicklaw40 replied 4 years ago.

kicklaw40 :

It sounds like you are in a Chapter 13 bankruptcy. To take out a loan on a vehicle while you are in Chapter 13, a Motion to Incur Debt will typically be required. The proposed terms of the new loan are reviewed by the judge and trustee to make sure they are reasonable. Typically, these requests are granted as long as the terms are reasonable, as the court knows that things like this happen and people need transportation. The situation you describe will probably require you to roll some of the negative equity into the new loan, which is not an ideal situation, but may be unavoidable.

Customer: replied 4 years ago.
I heard the court will allow a loan of only 15000, if you're already have a vehicle under plan, to roll over negative equity and trade in the existing vehicle, will they allow more than 15000?
Expert:  kicklaw40 replied 4 years ago.
That could be the case in your local court. Our local court does not have a set rule with regard to a dollar amount, but $15k is my personal limit for requesting debt for a vehicle in Chapter 13. I think it would be wise to use that amount as an upper limit for a request to incur debt.
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