Legal Question in Bankruptcy in Pennsylvania

How I go about owning a new car in my name before or after I file for Bankruptcy

Dear Law Counselors:

I am writing to ask you a legal Bankruptcy Law question.

I would like to know if I can buy a new car in my name before or after I file Bankruptcy?

I have over $35,000 of Debt, but I have not gotten a copy of my Credit Report as yet, can you please explain to me if it would be legal or preferable for me to purchase a new car before or after I file for Bankruptcy? Also I am trying to buy a House, but my credit report is terrible and the Real Estate Agent told me that if I do file for Bankruptcy, that I would have a better chance of getting a loan to buy a House. I am 100% Veteran Disabled and 100% Social Security Disabled. Please answer this question and e-mail me back with the answer. I am desperately in need to buy a House because I have three (3) of my Son's in Panama, and they're coming to live with me, and that's the reason I need to House, because rent is too expensive. Until I hear from you all, I am gratefully appreciate whatever advice that you can give me.

Thanking you in anticipation, I am.

Honestly Sincere,


Asked on 3/21/03, 10:23 am

1 Answer from Attorneys
Matthew Nahrgang Nahrgang & Associates, P.C.

Re: How I go about owning a new car in my name before or after I file for Bankru

I assume based upon your situation that you intend to finance the car. Therefore, you will have to qualify for a loan. It may be difficult now and easier after a discharge. That is the term for the elimination of your debt through bankruptcy.

If you want to try to obtain a car loan now, there is no reason not to. You will not lose the car as you will have no equity in it. Equity is the difference between what it is worth and what you owe on it. Also, you have a $2,500.00 exemption in any vehicle. That means, even if a Trustee in bankruptcy wanted to sell your car, he would be required to pay $2,500.00 to you. Based upon that and the lack of equity anyway, a Trustee will not sell it.

If you have cash and intend to buy it without a loan, the cash and/or equity is exempt up to $8,000.00.

You should know, the U.S. House of Representatives just passed a bankruptcy reform bill and it will likely become more difficult to file. Now is the time to act!

Feel free to call or E-mail on a free initial basis. I assist many people from the Bucks County area.

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Answered on 3/21/03, 10:40 am


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