910-Day Rule
What is the 910-day rule in bankruptcy?
The 910-day rule is a Chapter 13 bankruptcy provision: if you took out a car loan within 910 days (about two and a half years) before filing, and bought the vehicle for your own personal use, you generally cannot cram the loan down to the car's current value. You must pay the full remaining balance through your plan instead.
Key takeaways
- The 910-day rule comes from the 'hanging paragraph' after 11 U.S.C. §1325(a), added to the Bankruptcy Code in 2005.
- It applies only to a purchase-money loan on a vehicle bought for the debtor's personal use, taken out within 910 days (about 2.5 years) of the Chapter 13 filing date.
- When it applies, the loan cannot be reduced to the car's current value — the debtor must pay the full remaining balance through the plan, with interest.
- Loans older than 910 days at filing, or loans on vehicles not used personally, can potentially be crammed down under ordinary Chapter 13 rules.
- The rule does not apply in Chapter 7, where a different mechanism — a 722 redemption loan — lets a debtor pay the car's current value instead.
What is the 910-day rule?
It's a Chapter 13 bankruptcy rule that blocks reducing certain car loans to the vehicle's current value. If you took out the loan within 910 days — about two and a half years — of your filing date, and the vehicle was for your own personal use, you generally have to pay the full remaining loan balance through your repayment plan, not just what the car is worth today.
The rule comes from an unnumbered section of the Bankruptcy Code known informally as the "hanging paragraph," added after 11 U.S.C. §1325(a) by the 2005 bankruptcy reform law. It exists specifically to stop debtors from using Chapter 13 to strip a recent car loan down to a depreciated value.
Why 910 days, specifically?
Because that's the figure written into the statute — 910 days, not a round number of years, which is one reason it gets described inconsistently. It works out to roughly two years and six months.
The date that matters is when you incurred the debt, generally when you signed the loan, measured against your bankruptcy filing date. A loan that's 909 days old at filing is covered by the rule. A loan that's 911 days old is not, and can potentially be crammed down under Chapter 13's ordinary rules. Because the calculation is exact rather than approximate, confirming it is normally your attorney's job, not a rule of thumb.
What does it mean that the loan "can't be crammed down"?
It means the lender's full claim has to be treated as secured for the entire remaining balance, rather than split into a secured portion (the car's value) and an unsecured portion (everything above that). See cramdown for how that split normally works in Chapter 13, and why the 910-day rule is the exception that blocks it for most car loans.
In practice, your Chapter 13 plan generally has to pay the full loan balance, plus interest, rather than the lower figure a cramdown would produce. For a loan that's underwater — where you owe more than the car is worth — that difference can be substantial.
What loans does the rule actually cover?
| Condition | Covered by the 910-day rule? |
|---|---|
| Loan taken out within 910 days of filing, vehicle for personal use | Yes — no cramdown, pay the full balance |
| Loan taken out more than 910 days before filing | No — ordinary cramdown rules can apply |
| Vehicle bought mainly for business use, any loan age | No — the personal-use condition isn't met |
| Loan on collateral other than a personal-use vehicle | Depends on the collateral type; ask your attorney |
Both conditions have to be true at once: the loan has to be recent enough, and the vehicle has to be for personal use. A loan that's five years old, or a vehicle bought for a debtor's landscaping business, falls outside the rule even though it's still a car loan.
What if my loan is older than 910 days?
Then the 910-day rule doesn't block you, and an ordinary Chapter 13 cramdown may be available: the secured portion of the claim can potentially be reduced to the car's current replacement value, with the rest treated as unsecured debt in the plan. See cramdown for what that process actually involves.
This is also why the exact date matters so much in practice. Two debtors with an identical loan balance and an identical car can end up with very different plan payments, purely because one filed a few weeks earlier than the 910-day mark and the other didn't.
For the fuller picture of financing before, during, and after bankruptcy, see car loan after bankruptcy.
Common questions
Why is it called the 910-day rule?
Because it applies to a car loan taken out within 910 days — about 2 years and 6 months — before the Chapter 13 filing date. Loans older than that at filing generally are not covered by the restriction.
Does the 910-day rule apply to Chapter 7?
No. It's a Chapter 13 provision specifically. In Chapter 7, a debtor who wants to pay only the car's current value uses a different tool: a 722 redemption loan, paid as a single lump sum.
What happens if my loan is close to exactly 910 days old?
The count runs from the date the debt was incurred to the filing date. If it's close to the line, your attorney needs to calculate the exact days, since a handful of days can change which rule applies.
Does the 910-day rule apply to a refinanced car loan?
It can get complicated. Refinancing can affect whether a loan still counts as 'purchase money,' which is one condition for the rule to apply — worth confirming with a bankruptcy attorney rather than assuming either way.
What if I bought the car mainly for my business, not personal use?
The 910-day rule only covers vehicles acquired for the debtor's personal use. A vehicle bought primarily for business use falls outside the rule and may be eligible for an ordinary cramdown, subject to the usual Chapter 13 requirements.
Sources
- Bankruptcy Basics — Administrative Office of the U.S. Courts