Car tricks in Chapter 13 cases (cram down and interet rate high jinx)

Car tricks in Chapter 13 cases

Did you know that the filing of a Chapter 13 bankruptcy case allows you to modify the terms of your loan with your car lender?

Well yes, it’s true my friends. And it’s magically delicious.

Welcome to your new and improved interest rate:
So long as the person on the note (or persons) files bankruptcy, your Chapter 13 plan will provide that your car lender gets what called the ‘Till’ interest rate. Till refers the Supreme Court case that sets the maximum allowed interest rate that car lenders can expect to get. The Till rate is currently around 4.5%. That means if your interest rate is anywhere north of 4.5%, then you’re going to save money on the remaining balance of your loan. (Yes there is a potential wrinkle if your note is less than 4.5% interest; ask me to explain because the outcome depends on the lender.)
In most cases, it won’t matter if you bought the car last year, or last week. I ring the Till bell for all Chapter 13 clients regularly for my clients.

Welcome to your new and improved loan balance:
So long as the person on the note (or persons) files bankruptcy, and so long as the vehicle was purchased more than 910 days before your Chapter 13 case is filed, then I will cram down the value of your car to the replacement value / fair market value. Your plan will pay out the secured balance of the note. The remaining balance will go to your unsecured total.
Yes, it’s true. I can take that upside down loan and ‘right’ it.
The 910 day rule is fixed–the value of your car may not be.

Call me Attorney Shannon D. McDuffie for more information. (404) 418-8879