Chapter 13 Auto Financing

Getting an auto loan while in a Chapter 13 Bankruptcy is a very unique process.

If you have been in a Chapter 13 for very long, you know that the Bankruptcy Court and the Trustee basically have total control of your finances. You cannot add any debt without their knowledge, otherwise they could dismiss your Chapter 13 and you would be starting over. In Washington, and most other states, in order to get an auto loan with a car insurance quotes for your vehicle while in your Chapter 13 Bankruptcy, you have to obtain a letter from the Trustee granting permission to buy a vehicle outside of your repayment plan or obtain signed Motion to Incur Debt.

The Trustee letter is a fairly new process in the state of Washington. As recently as November 2011, the only way people in a Chapter 13 could get an auto loan was with the Motion to Incur Debt, which took about a month. Since dealers turn their inventory over much faster than that, the process was painfully frustrating.

Now, in most cases, we are able to go through the Trustee to get permission.

Chapter 13 Auto Financing Process:

  1. You contact someone who specializes in Chapter 13 Bankruptcy Loans (like WA Auto Credit)
  2. We review your bankruptcy and credit to figure what programs you will qualify for.
  3. We filter your probable loan criteria against the available dealers’ inventory to help you find as many vehicle options as possible based on the monthly payment and down payment you feel comfortable with.
  4. Once you pick out a car, we prepare all of the paperwork (including contract, licensing documents, and buyer’s order) to give your attorney so that you can request specific permission letter from the trustee.
  5. We will hold your car for up to 10 days allowing you time to get the permission letter. Without the letter, you do not have a real approval or a real loan.
  6. We then get final approval from the lender and fund your loan once all the normal verifications have been done.


  • Cheryl Spencer March 31, 2011 at 6:22 pm

    Would like to get a cheaper car. Spoke to my lawyer and he said for me to try and get a cheaper car and let the car I have now go. Payments for present car are very high.

    • The Credit Director March 31, 2011 at 6:29 pm

      It happens. We have helped people in similar circumstances. Are you here in Washington?

  • Stephen December 28, 2015 at 2:39 pm

    I have a open 13 bankruptcy in Florida but moved to Seattle for a new job and would like to finance a car. Am I able to get the loan? I spoke to my lawyer and he told me i need to get a contract and all paper from the dealer to apply for the motion. How should I start? Who should I contact. Appreciate your help.

    • Ryan Garrison December 28, 2015 at 2:43 pm

      Hi Stephen,
      We can help you with that. Call in to 360-529-0002 and we can get started.


  • Luis Collazo February 27, 2016 at 11:35 am

    My current car lease is getting to an end on 4/24/16 and will like to keep my car and re-finance it through another lender. Can you help me with this?
    The lease contract says that the cost of my car at the end of the lease is $14555. The car is a 2013 Nissan Altima and I will like to have a re-finance for 36 or 48 month.


    Luis Collazo

    • Ryan Garrison February 27, 2016 at 11:47 am

      Hi Luis,

      We cannot do that, but if you live in Washington or Oregon we can work with you to help you buy another car.


  • Larry Birkhofer April 25, 2016 at 9:22 am

    I’m looking for a company that will do a loan for me. I’m in Phx Az. Almost two years into chapter 13. I found a car I really want. And I know payments would be under the payments my law office said I need to keep it under. Our credit score is around 675/680. She’s been working at her job for over two years. I’ve been at mine 7 months. But I have been in the same line of work for 18 years.
    Can you guide me who would be open to do a loan?
    How much does this extra service cost?
    Thank you !!

    • Ryan Garrison April 26, 2016 at 12:46 pm

      Hi Larry,

      I would love to help, but you would need to come up to Washington for us to assist.

      If you are in Arizona, I think you should look up Mr. Ed. They do similar things that we do here in Washington.


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