luxury purchases

[sleeplessinohio]

Hello,

I'm trying to ask this as straightforwardly as possible.

If you wait for 12 full calendar months after making luxury purchases (bowflex, higher end kitchen appliances) and cash advances, are you pretty safe from creditor objections or accusations of fraud?

I appreciate your experiences and information.

[Stilltheone]

I am quite new to this bankruptcy process, but from what I've read, I think 12 months is a pretty safe amount of time to wait.

We just took a vacation in December, using our cc, and filed in March.

Good luck!

[Phillymanhere]

From what I've read on this forum and what I've gathered from meeting with lawyers, you will be ok. Now keep in mind, there are not hard and fast rules on any of this. By the way, I'm not sure refrigerators, etc., would qualify as "luxury" purchases if you needed them.
But 12 month is considered a good waiting period ... But I don't think you want to run-up a bunch of purchases knowing ahead of time that you'll later wait 12 months to file for bk. That is where fraud comes into play.
What have the lawyers said? ... Have you met with any?

[HHM]

Have you made payments on those various accounts?

[Flamingo]

Hello,

I'm trying to ask this as straightforwardly as possible.

If you wait for 12 full calendar months after making luxury purchases (bowflex, higher end kitchen appliances) and cash advances, are you pretty safe from creditor objections or accusations of fraud?

I appreciate your experiences and information.

I will also be straightforward - if you can wait 12 months to file bankruptcy, then you should not be worried about your financial situation at the moment and have no need to be worried about anything. If creditors suspect fraud, just cause someone else says they were fine and no one checked on anything doesn't mean it will apply to your situation so there is really no safe period for one specific person. Creditors and trustees know all the tricks and you can bet they or their representatives lurk on forums such as these to see what questions are asked as to those trying to beat the system.

[CindyLou]

After the 90 day period, the burden of proof shifts to the creditor. They have to prove it was fraud. Within the 90 day period, if they file an objection, you have to prove it was not fraud!

It was be very hard for them to prove this greater than a year later. But of course there are no garantees.

[CATCHMEIFYOUCAN]

What HHM mentioned about making payments on them, it would be in your favor if you had, less chance of creditor(s) claiming fraud. More chance if you haven't attempted to pay them back!

Catchmeifyoucan

[sleeplessinohio]

Hello all,

Thank you for responding.

The purchases were made a couple of months ago. Soon after, my husband lost his job.

Fortunately, we have been able to make all payments, and I believe we will be able to do so until after a year has passed. Another reason we need to wait is that we are hoping to file a Chapter 7 and need at least six months of lower income in order to be able to do that.

I'm grateful for this forum.

[HHM]

What amounts were the cash advances?

Did you use in-house store credit to buy the appliances, if so, that credit is probably a secured note.

So long as you make the minimum payments and the cash advances are not huge (in excess of $10K), then you will probably not see an objection. If the appliances are secured, the creditor may squawk about a reaffirmation, but most of the time, the never follow up on their threat to repo the items (because there really is no ready, reliable after market for used consumer goods). But, given the amounts that are probably involved, you should wait a minimum of 6 months, and my recommendation would be nine months or longer.

[Flamingo]

Hello all,

Thank you for responding.

The purchases were made a couple of months ago. Soon after, my husband lost his job.

Fortunately, we have been able to make all payments, and I believe we will be able to do so until after a year has passed. Another reason we need to wait is that we are hoping to file a Chapter 7 and need at least six months of lower income in order to be able to do that.

I'm grateful for this forum.

In your original posting, you mentioned purchasing several large ticket items and then also cash advances. Did you take out large cash advances to purchase these items or were the cash advances in addition to purchasing the items on a store credit card or Mastercard/Visa? I am sorry about your husband's job loss; totally understand. You need to take your situation and view it from a point an attorney/trustee/creditor would when/if you inquire about filing. Many people don't take a year to preplan filing bankrtupcy - that is a long time. Most people get sideswipped quickly by a major occurrence (i.e., job loss, major medical occurrence) and either take a long time trying not to file or file shortly after the job loss or medical emergency because they just cannot afford to pay bills during the time of the loss of income. It is apparent you are able to get by so I am assuming you are working and your spouse might be carrying a part-time job while you are working.

You need to figure out whether or not your hubby will be able to find a job close to what he had before because a year is a long time to be out of the job market and recover. Circumstances can change dramatically in a year's time so I hope you know what you are doing and that it works out for you.

[sleeplessinohio]

Thanks, HHM and Flamingo,

The cash advances were less than 10K and were used to make house repairs. The appliances were purchased on a bank credit card, so I'm assuming they are unsecured.

Again, I appreciate your responses.