910 Cars in Chapter 13

Hoping to learn more about your options when faced with financial challenges? You've come to the right place.
Stephen Dunne, Esq.

Stephen Dunne, Esq.

Philadelphia bankruptcy, credit report, and debt collection abuse attorney

Hoping to learn more about your options when faced with financial challenges? You've come to the right place.
Stephen Dunne, Esq.

Stephen Dunne, Esq.

Philadelphia bankruptcy, credit report, and debt collection abuse attorney

Today is the day.

It’s past time you had someone in your corner.
Our first consultation is always free.

You cannot cramdown a car loan if you purchased a car within 910 days of filing bankruptcy.  

The infamous hanging paragraph in §1325(a) prohibits a cramdown but you can still take advantage of the Till interest adjustment. The Supreme Court’s decision in Till v. SCS Credit Corp, 541 U.S. 465 (2004) establishes the interest rate a debtor must pay on his/her car loan in a chapter 13 bankruptcy.  A debtor should start with a prime plus interest rate of 4.25% based on today’s prime interest rate of “3.25%” plus 1.00% to account for the Till adjustment of 1.0% to 3.0%.

Even if you’re unable to cramdown the car loan principal because the car was purchased within 910 days, you can still cramdown the interest and save thousands of dollars.

In a recent case, a client’s car loan before chapter 13 bankruptcy was $572 per month at 11.45% interest with an estimated total of $34,297.  Contrast that with a lower monthly payment of $482 at 4.25% interest and estimated total of $28,930.  The client saved over $5,000 dollars on her car loan simply by taking advantage of the Till interest rate of 4.25%

Consumers can save thousands of dollars on their car loans thanks to the Supreme Court’s Till decision.

Today is the day.

It’s past time you had someone in your corner.
Our first consultation is always free.

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