How Does a Cram Down Work?
Since cars depreciate so quickly, it is not uncommon for a person to owe significantly more on the vehicle than it is actually worth. Chapter 13 bankruptcy offers relief to people who are in this situation. A Chapter 13 cram down allows you to modify your car loan and pay less than the original terms of the loan.
For instance, if you owe $15,000 on a car, and its fair market value is determined to be $10,000, a Chapter 13 bankruptcy will strip $5,000 of debt off of your shoulders and give you three to five years to pay the remaining balance.
In order to qualify for an auto loan cram down, you must have purchased the vehicle no sooner than 910 days prior to the bankruptcy filing.
To determine if you are eligible for an auto loan cram down, it is important to consult with an experienced bankruptcy lawyer.
Contact Us • California Bankruptcy Lawyers
For a free initial consultation about filing for bankruptcy with Simon Resnik Hayes LLP, call 888.368.4099 or contact us online. Our offices are open weekdays from 7:00 a.m. to 7:00 p.m., and we serve clients in the Los Angeles area and San Fernando Valley through offices in Sherman Oaks and Los Angeles.
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We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.