If I cannot receive a discharge from 13 when file less than 4 years after a 7 how do I ever purchase a new vehicle?

Asked about 1 year ago - Tioga, LA

I filed a Chapter 7 bankruptcy due to some issues I was having in my personal life. Less than a year later my wife and I decided we did not want to lose our house so we filed a Chapter 13. At that time, no one told us we would never receive a discharge. Now, everything is complete and closed in my Chapter 13 but banks will not lend us money for a new vehicle because they do not see a discharge for my Chapter 13 on my credit report. They only see the discharge for my Chapter 7. What am I supposed to do? I can't drive these vehicles around forever. I've been driving them for 6 years and they were used when I bought them. I desperately need some help. I've spoke with my lawyer and the only answer she gives me is that the banks need to learn about the way bankruptcy works.

Additional information

I filed a Chapter 7 6 and a half years ago. I filed a Chapter 13 5 and a half years ago. I was told I will never (Emphasis on NEVER) receive a discharge for a Chapter 13. I have a court docket stating that my bankruptcy case is closed. I have a letter stating that my Chapter 13 is complete and all payments have been disbursed. But... all the dealerships keep telling me that the bank is asking them for a discharge on my credit report. Other than looking for the discharge on my credit report... the banks say I am completely appoved to receive a loan. I am just in desperate need of a new or "newer vehicle".

Attorney answers (6)

  1. Matthew Scott Berkus

    Contributor Level 20

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    Answered . Scott's right, on the bankruptcy side of things, there is nothing to do, and there is nothing you can do. The issue is convincing a car finance guy that the bankruptcy is not pending. You should probably get a PACER account (that is the official bankruptcy court database, www.pacer.gov) so you can pull some documents from your case. Once you are logged in, select "Query" from the top left of the screen, then enter your case number. That will pull up a menu. In that menu, select "case summary". Print that page. The entry of note is the date the case "terminated". That means the case is closed.

    Off the top of my head, I don't recall if, in a non-dischargeable 13, there is an order (a document) closing the case. I don't think there will be. But you can back out to the menu and select "History/Documents" and see if there is any thing in the results that might help.

    The goal being that you will need to bring this information to the next car finance guy you see for a manual review.

    Second, review my AVVO article on the 3 essential steps to rebuilding credit after bankruptcy. (see the below link)

  2. Scott Benjamin Riddle

    Pro

    Contributor Level 20

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    Answered . Banks and lenders often don't know Bankruptcy, but in this case it looks like they have it right - you did not get a discharge. You don't tell us the time line? How many years ago did you file Ch. 7 and then Ch. 13. Did you complete a 3-5 year Ch. 13 plan? If so, when? None of this really fixes your issue, but as I am sure you know, two recent bankruptcy cases is a big negative for traditional lenders and the remedy is often the passage of time. Your BR lawyer is not in a position to help you get a loan. Otherwise, keep shopping for loans or maintain your current vehicles.

  3. Ray Choudhry

    Contributor Level 14

    3

    Lawyers agree

    Answered . You may not remember, but not only were you told you would not receive a discharge, they probably made you sign a waiver of discharge.

  4. Robert S. Simonian

    Pro

    Contributor Level 7

    2

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    Answered . The best approach is to get a copy of your chapter 7 bankruptcy listing all of the debts that were discharged and a copy of you chapter 13 bankruptcy indicating (presumably) that the only debt addressed in that bankruptcy were/was the mortgage arrears. That along with copies of your credit report should show that you have been discharged from all of your obligations and debts. you can then sit down with a finance person and show them what occurred and that should satisfy them.

  5. Marc Gregory Wagman

    Contributor Level 17

    Answered . The trustee in a Chapter 13 will do a motion to object to the discharge (or really an adversary) which you got notice of so the clerk won't enter one in my district. I would fathom this is standard procedure in all districts.

    The response given is not intended to create, nor does it create an ongoing duty to respond to questions. The... more
  6. Dwayne M Farnsworth

    Contributor Level 14

    Answered . I have a better answer. Don't finance your next vehicle purchase. Keep your current vehicles in good running condition while at the same time saving up money to purchase a used vehicle for cash. It really works. My wife and I have not financed a motor vehicle in the last 28 years since we were married. It's a lot of work looking for the right vehicle, saving up to buy it, and keeping our current vehicles in working order while trying to find a new vehicle. But it works! Good luck!

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