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  1. #1
    Join Date
    Nov 2011
    Posts
    1

    Default Default on Car Loan During Bankruptcy - Am I Responsible for the Deficiency

    My question involves bankruptcy in the state of: PA, Philadelphia

    Ok, me and my wife are almost finished with our long 5 year Chapter 13. We have like 7 payments left to go. To give you an idea to or pre-file status it is; we filed and were forced to pay 100% to owed; it was a five year plan; it was mainly CC bills, medical bills, etc. The house and at the time car was not under the filing. So here is my issue...

    Shortly after filing the Chapter 13, like 6 months into it, my wife lost her job (closed down), so her income was cut down. about 3 months into her unemployment we could not keep up on the new car payments of $660 per month, so I asked my lawyer could I surrender the vehicle, he said yes, I also ask the lawyer if by doing so, would/could they come after me, during or after the Chapter 13, he said that you can not aquire new debt and so my lawyer asst me in surrendering the vehicle. Another 3 months went by and my wife was able to get another job, we were getting back on track, but we noticed that the car company sold the vehicle and the difference appeared on the monthly trustee statement, but that no moneys were going towards it. So after seeing it on the statement for a couple of months, I called the lawyer and ask him about it and he informed me that its listed, but we don't pay on it. Keep in mind that I also called the trustee on it as well, and the same answer came to me.

    Here is the best part. Like I said we are like 6 months left on the plan, so about 3 months ago, I get a letter from the trustee that states that we have to pay on the vehicle and that we owe about $13000 on it. So with my lawyer request I supplied our paystubs and sent them to him for review and some chapter 13 thingie. Well I get a call from my lawyer that states that the trustee is raising my plan payments to $1360 per month from $430, based on our income, but in realness we can not afford this new payment. By making this new payment plus the current bills, we would be left with less than $500 per month to support a family of 5.

    So this is my biggest question...
    The vehicle has been listed on the statements since like month 12 into the chapter 13, why then did they not make me pay it then where the payment would have only went up $260 more per month, verse wait till I had 6 months left to pay off and not the payment is $900+ more per month. Is there any way I can fight this on this ground that it has been there since the 12 month make? Can I fight my lawyer, whom doesn't seem to be doing much to help me on this? Can I fight the trustee for not catching and doing something about it, when it first appeared? I'd really hate to back out now, but what if I am forced to, cause, I can't afford that new payment?

    Any help on this would be great... Or just point me in the right direction.

    Mike

  2. #2
    Join Date
    Sep 2005
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    Behind a Desk
    Posts
    98,846

    Default Re: Default on Car Loan During Bankruptcy - Am I Responsible for the Deficiency

    Your original lawyer was supposedly helping you surrender the vehicle such that this would not happen, and apparently something went awry. Have you tried contacting him to discuss the issue? If the trustee took a different position back when you defaulted on your car loan, have you asked him why he changed his mind?

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