MasConcepts Incorporated

Hoping this will help others out there in a BK13 (high income, high debt situation) who need to buy a car. I’ve found surprisingly scant experience from others in this situation, and even my attorney didn’t have much advice to offer.

I filed for a chapter 13 in 2025 and wanted to get rid of my car loan. I owed $22K on a car worth about $6K but couldn’t do a cramdown as I had bought this car a couple of months too late to qualify. So my options were either to keep throwing good money after bad and paying the car loan, or to wait for the lender (Ally) to file a motion to repossess the car.

I made my last payment nearly a year ago, right before filing for my 13, and it took a solid 10 months for Ally to file their motion. So I essentially got a “free car” for that period of time. In fact Ally still hasn’t repossessed the vehicle, even 2 months after their motion – it’s sitting on the street outside my apartment waiting for them to come get it.

I shopped around at various dealers here in the Los Angeles area over the last couple of months, and most denied me due to the open bankruptcy. However, I was able to work out a decent deal with DriveTime. They are nationwide (same parent company as Carvana) and own their own finance company (Bridgecrest). With my income and credit score, I qualified for any car on their lot with $0 down and around 17% APR. Their selection is very basic, nothing fancy, but they have a good number of late-model cars with low mileage on their lot. Once I got the letter from the bankruptcy judge allowing me to incur the new debt, it was so easy to get financed with them. Other dealers either denied me outright or could only do a deal at 28% APR with $4000 down (yikes).

So now I’m driving a newer car, for around the same monthly payment as my old Ally loan, but it’s a $20,000 vehicle with 24k miles instead of a $6000 vehicle i owe $22,000 on with 114k miles!

Hope this helps others out there who need a new car while in an open 13.