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Can I Buy A Car Before I File Bankruptcy?

Can I Buy A Car Before I File Bankruptcy?


My name is Ron Drescher. I’m an attorney practicing
bankruptcy and creditor’s rights in Maryland, Delaware, Pennsylvania and Virginia. Today
I want to answer the question my car is on its last legs, but I need to file bankruptcy,
can I buy a car right before I file? The answer to that question is yes. If you need a car,
you should buy one before you file bankruptcy because after you file, the bankruptcy case
is going to be a lot harder for you to get credit. The bankruptcy courts recognize that
debtors need to have transportation in order to work and manage their daily affairs. So
it’s generally considered an acceptable form of pre-bankruptcy planning for you to buy
your car before you file bankruptcy. Now, if you’re going to be filing a Chapter 13
case what that means is that your net income is going to be reduced by the amounts of your
car payment. So if your car has previously been paid off and now you have a car payment
and you’re going to go into Chapter 13 in effect, the creditors are going to be paying
for your car. Still bankruptcy courts allow this because debtors need to have transportation
so they can maintain their jobs, so they can pay on the Chapter 13 plan and so that creditors
can realize something. My name is Ron Drescher. I’m an attorney practicing bankruptcy and
creditor’s rights. If you have a question of whether you can buy a car before bankruptcy,
please pick up the phone and call me. I would love to hear from you.

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1 thought on “Can I Buy A Car Before I File Bankruptcy?

  1. I advise my clients to choose a modestly priced car if they are going to make a purchase in the days or weeks prior to filing. No point in testing the "good faith" patience of the judge.

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