They cannot take it until after discharge. Or they have to file a Motion for Relief from Stay and get the court's permission to come take it before discharge. If you stop paying and they come take it without a court order or before discharge, they can get in trouble.
Talk to your attorney to make sure those rules apply in your jurisdiction before you stop paying though.
Starting Score: 11/29/12 TU 527; EQ 565; EX 564 fako - bk7 dc'd 2/15/13
New goal 675
Yes, stop paying on anything that's going in the BK, save that $ for your down payment on the next one.
Also, "surrendering the car in the bk" doesn't make it disappear. After your discharge, you'll need to work out with the lender where you're going to drop it off. Also, look in to a 721 redemption.
If you can hang on to the car for a month after the discharge, that should give you ample time to clean up your credit. With the right down payment, and the right lender, you should be able to get between 4 and 8% (C1 Auto Finance, Credit Unions, anything but the dealer) on a good used car. No one without millions should ever buy new, but you can get 2-5% (C1 auto finance, Credit Unions, even some local banks) within 60 days of discharge if you want to be silly and piss your $ away on a new one.
On the other hand I REALLY like the Ramsey method for buying cars:
- Buy clunker (<$1000) you can afford to pay cash for
- Save $400/mo for 10 months
- Buy $4000 decent used car (This is Car #2)
- Sell clunker for EXACTLY what you paid for it (or keep it, whatever)
- Save $400/mo for 10 months
- Sell Car #2 for $3500-$4000 (older cars don't depreciate much in 10 months)
- Buy Car #3 for ~$8000 = really good used car
- Save $400/mo for 10 months
- Sell Car #3 for ~$8000
- Buy Car #4 for $12000 = GREAT used car (Incl 5 year old Jeeps, Jaguars, etc)
You get the picture and can repeat as much as you want, but in this plan you have a really good car in 20 months and a great car in 30 months without ever paying a dime in interest.
-SM
Starting Score: ~470 preBK(8/2010)