Two and a half years. That is what nine hundred ten days works out to, give or take.
In a Chapter 13 case that number can decide whether a car loan gets paid in full or paid at the value of the car. The gap between those two outcomes is often thousands of dollars.
What the Rule Does
Normally a secured claim can be split. The part covered by the collateral’s value is secured. The rest is unsecured and gets treated like other unsecured debt.
For certain car loans, that split is turned off. The creditor gets paid on the full balance instead of the vehicle’s value.
That is the whole fight in one sentence. Everything else is about whether the rule applies to your loan.
Counting the Days
Start with the date the debt was incurred. That is normally the purchase date on the contract, not the date of the first payment and not the title issue date.
Then count backward from the petition date. If the purchase falls inside that nine hundred ten day window, the rule is in play.
People make two mistakes here. They use the wrong start date, and they forget that the filing date is a choice.
Sometimes waiting three weeks moves a purchase outside the window. That is not a loophole. It is the calendar doing exactly what the statute says.
Personal Use Is the Second Test
The rule only reaches vehicles acquired for the personal use of the debtor. A truck bought and used mainly for a business is a different question.
Use is a factual matter. Mileage logs, tax deductions taken on the vehicle, and how the loan was written all come into it.
This is where cases get argued. It is also where good records before filing pay off.
Negative Equity Rolled In
Trade ins complicate things. When a dealer rolls an old loan balance into a new one, part of the new debt is not really for the new car.
Whether that rolled in amount counts as part of a purchase money interest has been litigated hard. In the Sixth Circuit, which covers Kentucky, the answer is settled and it favors the lender.
So a Kentucky filer should not count on splitting off the negative equity portion. Filers in some other states have had more room to argue.
Flag any payoff to a prior lender on your contract anyway. It affects the numbers even when it does not change the rule.
For a fuller walkthrough of how the rule is applied to real vehicles and real dates, Nick Thompson, a Louisville bankruptcy attorney breaks the test down step by step for Kentucky filers.
What the Statute Says
The rule is not a separate section. It sits at the end of the plan confirmation statute, in what practitioners call the hanging paragraph. The text of section 1325 includes the language about a debt incurred within the nine hundred ten day period and collateral consisting of a motor vehicle acquired for personal use.
There is a companion rule for other collateral, using a one year window. It comes up less often, but it exists.
Documents That Settle It
Three papers usually answer the question.
The retail installment contract, which shows the purchase date and any payoff to a prior lender. The title, which shows the lienholder. And the current payoff quote, which shows what is actually owed today.
With those, the count takes five minutes. Without them, everyone is guessing.
Why It Matters Locally
Plenty of households in Jefferson, Oldham, Bullitt, Spencer, Nelson, and Meade counties are financing vehicles they need to keep a job. A plan payment that assumes the wrong rule can fail two years in.
Getting the count right at the start is far cheaper than modifying a plan later.
If you have a car loan and a Chapter 13 on your mind, call 502-625-0905 and bring the contract.
