Buying a car during Chapter 13 bankruptcy

The basic rule of Chapter 13 bankruptcy is that you agree to pay what you can for three to five years in return for having a large portion of your debt wiped away. For any extra credit you need to get the trustee approval. Any expense can make your payment plan obsolete so is natural to have the trustee approval before getting new debts.

Also you need to announce the trustee of your getting less or more money. He can adjust the monthly payments according to your income. The trustee may approve the additional credit for a decent car (200 to 250 per month rate) but when you talk to the trustee, you will have to present a new accounting of your income and expenses. The bankruptcy trustee will challenge anything excessive so prepare your facts carefully.

If you earning some extra income and presents the situation correctly to the trustee you will be allowed to finance a new car. But the hardest part may be the actual finding a car that you can finance. Even if this is time consuming process you will find a dealer that is willing to give you a car (maybe with a bigger interest).

Again , this car will satisfy your basic transportation needs; don’t even think to something more than basic because the trustee will reject this option from the start.

As you can see, even if you are in a difficult situation like chapter 13 bankruptcy you can manage to get a car. As a final advice: stay away from second hand cars. These machines can consume a lot of money with repairs and maintenance.