Cramdown of value on a motor vehicle, to pay replacement value only, not full amount due.
The first consideration is whether the loan is over 910 days old. The 2005 Bankruptcy “Reforms” protected automobile finance companies, sellers, and lenders, by forcing the purchaser of a vehicle within the last 910 days to pay the full amount of the debt on the car. This is typically a predatory amount of higher than retail price, excessive interest, and worthless add-ons like insurance, warranties, and undercoating.
However, if debtor is in this “more than 910 days” area, then he might be able to pay only the value. But what is the value? By definition, it is “replacement value”, or the price a retail merchant would charge today for a car like this one, taking into consideration the age and condition of the car. A start to determine that value is KBB.com and NADA books. Also, factor in particular discrepancies, like accident damage, or required repairs.
Your attorney can help in properly filing this information and getting the appropriate payment in the plan.
mysanantoniolawyer.com
David A. Bosworth
Bankruptcy Attorney
San Antonio, TX
210-805-9334
Tagged as: bankruptcy, repossession, vehicle valuation