Preferential Payments

[CATCHMEIFYOUCAN]

Hey, I paid alot of money out to creditors just before I filed, more to some and nothing to certain unsecured creditors. Isn't that considered preferential payments? I even claimed that I paid $10,000 to one creditor to pay off another (it really was a transfer to from paul to pay peter), since the creditor thought it cute to consider it a cash advance, well I got cute back and considered it a payment to a creditor that I made and listed it like so on schedules. But the thing is the trustee never mentioned anything about these payments. And, I paid all and all about $15,000 back within 3 months!

Anyone's thoughts ? Catchmeifyoucan

[HHM]

Preferential payments is really about transferring assets, using one credit card to pay another is not a transfer of assets (it will generally lead to an objection to discharge from the creditor whose card you used to pay the other card, but it is not a preferential payment).

Moreover, preferential payments only refers to payments made to creditors in the same category. I.e you are allowed to "prefer" secured creditors over unsecured creditors. Thus, if you make a car payment in lieu of paying your credit card, it is not a preferential payment. But, if you pay your Chase Visa and leave a large balance on your American Express, that would be a preferential payment.

The most common types of preferential payments is when someone pays a family member to whom they owe money but does not pay their creditor cards.