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In short, No.

A "cram down" is special provision found in the US Bankruptcy code §1325(a)(5)(B)(ii) to modify a secured loan in a Chapter 13 plan even over the creditor's objection. Since there is no pay back plan in a Chapter 7 there is no way to "cram down" a loan with a chapter 7 bankruptcy. However, not all is lost.

A chapter 7 wipes out all contracts but it does not wipe out security interests. What this means is that when you have a car loan and you file a chapter 7 you no longer owe any money to the creditor but the creditor still has the right to repossess the vehicle.

If you'd like to keep the vehicle then you'll have to enter into a new contract with the creditor. This is called a "reaffirmation agreement" because you are reaffirming the debt. It is possible that the creditor could offer you a better rate or a lower principal than you had before based on the value of the vehicle. However, usually they offer the same terms that you had before. You can always negotiate for better terms but the creditor does not have to agree.

If you do not sign a reaffirmation agreement within 45 days of the 341 meeting (the 341 meeting usually takes place a month after filing) then the "automatic stay" is terminated and the creditor may repossess the vehicle.

Another trick is to file a chapter 7, which will buy you some time and then convert to a chapter 13 to cramdown the loan. But the cramdown only works if the note matures within the life of the bankruptcy. So if you have a 6 year note then the cramdown would not be available to you.

Goodluck.

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14y ago
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14y ago

A cram down, a generic not legal term, is for having a plan or action forced upon those who it effects. The court would have to do so, and it would only do so if it feels the plan is reasonable, legal and the solution to an issue that those rejecting it are basically unfairly or unreasonably rejecting, trying to get some other, unrealistic benefit. Hence, for most all personal BKs it isn't relevant at all and especially on secured claims, where the Court could not legally override the secured interest...especially to essentially have the bankrupt get a benefit. (I gather your thinking have the court "cram down" a ruling to the secured lenders that you don't have to pay the debt, and yet their legal right to the property is also overrident, so you get it at their entire expense. Doesn't seem even remotely reasonable does it?

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Q: Can you do a cram down in chapter 7 for car and mortgage?
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Related questions

How long do you have to wait after purchasing a vehicle to file a chapter 7?

If you intend to reaffirm the debt, there is no rule. If you want to try to cram the debt down on the car, or surrender it, you may find yourself in trouble, since you must have lied about your financial situation in order to buy it. Irf you paid cash for the car, you may have to turn it over to the trustee unless the car is exempt.


What is a sentence for cram?

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What happens if you lose your job after filing Chapter 13 with a wife who works a mortgage and two car notes in Ga?

If you are unable to make the mortgage payments, you will lose the house to foreclosure- there is nothing you can do at that point. The only option would be to convert to a chapter 7 to discharge any other non-mortgage debt. If you want to keep the cars (or any secured debt for that matter) you will need to KEEP making those payments.


If you default on your home mortgage can the mortgage company come after your car?

They can not directly come after your car. However a Judge can order assets seized. If there was no fraud involved in the mortgage this is an unlikely situation.


My car starter disbled comes on the display when I try to start my car 98 cat deville up can I bypass it and how.?

You can! We are here for you! Just sing the Alphabet and laugh really hard about a monkey eating ice cram! You can! We are here for you! Just sing the Alphabet and laugh really hard about a monkey eating ice cram! You can! We are here for you! Just sing the Alphabet and laugh really hard about a monkey eating ice cram! You can! We are here for you! Just sing the Alphabet and laugh really hard about a monkey eating ice cram!


If you gave up a car in chapter 13 will you have to pay for it if the chapter 13 is dimissed?

if your chapter 13 gets dismissed can you buy a car


Will you be able to purchase a car if you have a mortgage foreclosue on your credit report?

Yes, but be prepared to be required to have a larger down payment. Your interest rate will also be higher.


IF you have two car payments in chapter 13 Do you have to give up one car?

No. Chapter 13 offers individuals a number of advantages over liquidation under chapter 7. Perhaps most significantly, chapter 13 offers individuals an opportunity to save their homes from foreclosure. By filing under this chapter, individuals can stop foreclosure proceedings and may cure delinquent mortgage payments over time. Nevertheless, they must still make all mortgage payments that come due during the chapter 13 plan on time. Another advantage of chapter 13 is that it allows individuals to reschedule secured debts like cars (other than a mortgage for their primary residence) and extend them over the life of the chapter 13 plan. Doing this may lower the payments. Chapter 13 also has a special provision that protects third parties who are liable with the debtor on "consumer debts." This provision may protect co-signers. Finally, chapter 13 acts like a consolidation loan under which the individual makes the plan payments to a chapter 13 trustee who then distributes payments to creditors. Individuals will have no direct contact with creditors while under chapter 13 protection.


Will the bank go after your house if you don't pay for your car loan?

no, your car loan is secured by your car, your mortgage by your home


Can you get your car back after a repossession if you file chapter 13 bankruptcy?

In GA Can you get your car back after a repossession if you file chapter 13 bankruptcy


How many words you can make from the word CAMERA?

Words from the word, CAMERA: me car are mac care came cream race ram cram


Is your monthly car payment reduced in Chapter 13?

Maybe..but then it goes on for longer. Chapter 13 offers individuals a number of advantages over liquidation under chapter 7. Perhaps most significantly, chapter 13 offers individuals an opportunity to save their homes from foreclosure. By filing under this chapter, individuals can stop foreclosure proceedings and may cure delinquent mortgage payments over time. Nevertheless, they must still make all mortgage payments that come due during the chapter 13 plan on time. Another advantage of chapter 13 is that it allows individuals to reschedule secured debts like cars (other than a mortgage for their primary residence) and extend them over the life of the chapter 13 plan. Doing this may lower the payments. Chapter 13 also has a special provision that protects third parties who are liable with the debtor on "consumer debts." This provision may protect co-signers. Finally, chapter 13 acts like a consolidation loan under which the individual makes the plan payments to a chapter 13 trustee who then distributes payments to creditors. Individuals will have no direct contact with creditors while under chapter 13 protection.