Advice on BTs: Don't do it!

[Medora]

Hi All--
Well just a personal story here about experience with balance transfers, as I've commented on several posts about them in the last couple of months.
I've been worried because I BT'd $40K in July, and $34K from one BofA to another in September.

We hired a BK lawyer who said that he is seeing MORE adversarial proceedings filed lately, probably because the bailout has made banks less afraid of hassling consumers. He says he doesn't want to gamble, so wants to wait at least a year from the July BT to file (he thinks we can probably bluff B of A out of their complaint), just to be on the safe side.

I wish I had know this back when I did the dreaded balance transfers, even in September, things were bad and what was I worried for about low interest for the life of the balances? what a joke.

Just wanted to passa along what I learned, the hard way.
Can't wait until July 09 to start getting over this mess!
happy new year,
Medora

[liz417]

Hi Medora,

What part of California are you in? I'm in California too and my attorney was concerned about BT/Cash Advances too.

[HHM]

Well, those are LARGE balance transfers. Although there have been some favorable rulings that BT's, by themself are not fraudulent because it is merely exchanging one debt for another and therefore the creditors must prove actual intent to defraud, those BT's are significant enough to raise an objection.

Your attorney is being conservative, and there is nothing wrong with that.

[ansky0007]

I agree... We had some large balance transfers and the card companies are trying hard to recoupe some of the funds lost. There is no fraud so I am not giving in to the settlements that they are trying to offer and it will get ugly in a month or so when they want us to go to a deposition on them.

[Medora]

Hi I'm in Southern Cal.
Ansky, wow, I can't believe you have to do a deposition! scary stuff. good luck.

[Duncan]

Could you elaborate more on the "adversarial proceedings" in relation to CC companies and large BT's? I realize I'm in the Ch7 area, but would this also ring true for Ch13 cases as well?

I am planning on filing Ch13 later this year, I'm currently finishing making minimum monthly payments to get beyond the "90 day last transaction" period. I plan on trying to go a few months beyond before having to file, depending on how aggressive my debt is pursued, the vast bulk of which (100k) is unsecured, most of which was originally racked up thru BT's of various sizes... The last few years were simply the BT shuffle, meaning one BT would be submitted to payoff a 0% card that I would be losing the interest rate on, etc... Most of the BT's were simply deposited into my checking account, NOT payments made frome one creditor to the next.

Am I going to have to show where the money went? Some of the accounts aren't even open anymore and I wouldn't even know where to begin looking. I thought that if my last BT's were well in the past, early 2008 were the last ones, and I was making my payments since then, I would be OK.

[danaf]

Not surprising given the current economy. And this is just w/ BT's - people thinking of large cash advances had better think twice in this environment.