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New Jersey Bankruptcy Lawyer Advises On Obtaining A Lease Or Auto Financing In A Chapter 13

Auto Financing in a Chapter 13 Bankruptcy

Sometimes in a chapter 13, the debtor’s lease expires or the individual needs to purchase an automobile. In general, it is possible to obtain a lease or financing if the debtors meet the criteria. However, the criteria may be different depending on the trustee for the bankruptcy case.

A debtor that wishes to purchase an auto or enter into an auto lease must first obtain a copy of the unsigned sales or lease contract and/or financing agreement from the dealership. All of the important terms and figures must be reflected on the unsigned contracts. Thereafter, the debtor must complete an “Application for Vehicle Financing During Chapter 13 Pan”. All of the unsigned contracts and the completed application must be submitted to the trustee for his/her evaluation and determination. If the trustee approves the application, the trustee’s office provides a letter or notice of “No Opposition” and consent to the dealership.

In general, obtaining a lease or purchasing an auto during a chapter 13 plan may be difficult, but it is possible based on the debtor’s financial situation and the seller involved. The consent of the trustee depends on the debtors’ financial position and the monthly trustee payments. Typically, a trustee will not consent to a lease or financing that requires a payment in excess of $350.00 monthly. Also, the debtor must show an ability to pay the monthly finance payments, in addition to his necessary expenses and trustee payment.

Robert Manchel, a NJ Bankruptcy Attorney,  will explain the process of obtaining a lease or auto financing in a chapter 13 case, by contacting him at 1 (866) 503-5655.

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