In the worst-case scenario, you may need to get the court to force the lender to give up the vehicle title. If they give you any hassles, go through the above steps and provide the lender with all the information they need to prove you’re entitled to your car title. You need to contact the lender directly to get your car title after bankruptcy. This document proves that you made your Plan payments and the case ended satisfactorily. Get a copy of the bankruptcy discharge.This shows how much the trustee paid out during the bankruptcy. Obtain a copy of the Trustee’s claims register.These will prove that your payment stream was backed by logic and the balance due on the loan. That includes any motions made to reduce the interest rate, the loan balance, and motions made by the lender to lift the automatic stay. Fetch copies of all motions filed in your bankruptcy case in connection with the car.These documents, when taken together, will show the amount you proposed to pay as well as the judge’s Order that those payments were sufficient. Obtain copies of the Chapter 13 Plan and Confirmation Order.This will show the balance due on the car as of the date of the bankruptcy filing. Get hold of a copy of the Proof of Claim filed by the car lender in your Chapter 13 bankruptcy case.It may not be easy to get your title from the lender, but take these 5 simple steps to make the process as smooth as possible: The bankruptcy court doesn’t have your car title, nor does the trustee assigned to divide your repayment funds among your creditors. Regardless of the benefits of using bankruptcy to modify your car loan, you’re still going to need to pry the title from your lender’s clutches. That leaves a lot of money left over for paying student loans, balancing your household budget, and starting to invest for retirement. The prime rate was 3.25% as of October 2015, which translates into a Till rate of 4.75%.Ĭonsider how much you’d save on your car if you walked into bankruptcy with a 10% vehicle loan and were able to walk out with a rate of 4.75%. You can find the Wall Street Journal prime rate here. In that case, the Court took the prime rate of interest and added an extra 1.5 percent premium to account for the lender’s risk of nonpayment. When you go into a repayment bankruptcy, you can reset the interest rate using a formula established by the US Supreme Court in the Till case. Most people struggling to get out of debt, however, may not have the best credit score – and that usually translates into a high-cost vehicle loan. If you’ve got excellent credit you may not be paying a high interest rate. As in, the interest rate on your vehicle loan can be lowered to 1.5% above the prime rate. Just how low does the interest rate go? Way down. If you’re paying a high-interest rate on your car, this could end up saving you thousands of dollars. Lower the Interest Rate with Chapter 13 BankruptcyĮven if you can’t lower the balance of the car loan, Chapter 13 bankruptcy gives you the right to modify the terms of the promissory note between you and the car lender. Even if you don’t qualify to do so, there’s still one more way to save money using the bankruptcy laws. If your situation matches up with any of these conditions then you will be able to bring down the balance on the car loan.
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