Can I Buy or Lease a Car if I am Still in a Chapter 13 Bankruptcy?

by | Sep 14, 2022 | Chapter 13 |

Clients often ask if they can buy or lease a car if they are in a Chapter 13 Bankruptcy? A Chapter 13 bankruptcy generally lasts between three years and five years. As a result, there are a lot of cases where someone’s lease is up during the bankruptcy or an automobile needs to be replaced. Can a debtor buy or lease a car while they are in bankruptcy. The answer is yes. Whether your case is in the Camden NJ Bankruptcy Court and your Trustee is Isabel Balboa whose office is in Cherry Hill NJ, your case is in the Trenton Bankruptcy Court and your Trustee is Albert Russo, Esq whose office is in Robbinsville NJ, or your case is in the Philadelphia Bankruptcy Court and your Trustee is Kenneth West whose office is in Philadelphia PA, the procedures are similar. Each require that you provide information to the trustee relating to the financing such as interest rate, down payment amount, amount to be borrowed, anticipated monthly payment, etc. Here is a link to the site of Trustee Isabel Balboa which reflects her version of the form. https://www.standingtrustee.com/wp-content/uploads/2020/09/vehicle_financing_application.pdf  The other Trustee’s have similar requirements. The purpose is to monitor and control to some degree the car payment amount since it will impact the debtor’s ability to pay the other creditors. Additional information on Chapter 13 can be found at this link. https://www.bravermanlaw.com/bankruptcy-law/chapter-13-bankruptcy/

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