Insider Payments?

[Aquinas]

I have a situation that may fall under the provisions of "Insider Payments."

Last August, the balloon payment on my auto loan came due, and because of my newly depressed credit scores, I was unable to refinance the loan myself. My mother offered to use one of her credit card convenience checks to assist with this payoff. She deposited the check into her personal checking account, then sent the loan company the payoff check in certified funds. Each month, a payment is set up through my mother's Chase Epay account (the bank on which the convenience check was drawn) to pay down the loan. It's my checking account, obviously, that is being debited by Chase.

Will these transactions be considered "Insider Payments," and if so, what is the likelihood that a Trustee would seek to recover the money, considering that the funds were used for an everyday necessity like an auto?

[CindyLou]

hmmm...your mom probably should have filed a lien on the car for the amount your borrowed. You are going to have to just be honest about this situation. If you don't mind me asking, how much is going to your mother every month? Can she get a copy of the cancelled check that was sent to pay off the car loan? How much was the payoff? I do think its all explainable and possibly not a huge deal. The fact that the payments are going to the same account that paid off your car might make the difference. See a couple of attorneys for your free consulations and get advice on how you should handle this situation on a go forward basis. One other thing....my brother just filed a 13. In the year before he filed my mom was paying his bills and then he was just paying her a lump sum out of his account each month. When he filed his bk he showed the bills she was paying and nothing came of it. I know your situation is a little different, but its just to show you that its not always cut and dry. Keep us posted.