Should I pay off car loan with line of credit?

410 viewsConsumer Proposals
0
0 Comments

Should I pay off car loan with line of credit?Should I pay off car loan with line of credit?

I owe $8000 on an existing car loan and $60,000 on a line of credit. Should I use the line of credit to pay off the car loan prior to filing a consumer proposal? In essence, making the $8k unsecured.

The loan and line of credit are with the same bank.

Is this fraudulent even though I have room on the line of credit to pay off the car?

 

Facebook Comments
Changed status to publish
0

It would be fraudulent because you propose paying off a vehicle loan over which the bank has security with a line of credit for which they have no security.

Thus you would be leaving the bank with $68,000 in unsecured debt instead of $60,000, while rewarding yourself with a free and clear vehicle with a value of $8,000.

Trustee

Facebook Comments
Answered question
Facebook Comments