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**okiemom2008** · 03-18-2009, 02:50 PM

Originally posted by AfraidOfBK View Post

OK, so glad to finally be a member of the forum, looks like a lot of promising info and guidance....

HERES THE SHORT VERSION OF THE STORY:
Facing foreclosure in Lv, NV (missed first payment this month March)
dont want house, have 26k of debt and some med bills....lots more med bills comin gwith birth of baby due in may.
Lawyer says wait to file till after May (obviously) plus i think that will allow me some time to live in home rent free BUT - all the money ive saved from not paying a 1900 dollar mortgage is now sitting in bank maing me look full of money.
I also am expecting a $3600 tax refund to be direct deposited sometime this month...need bunk bed for new arrival and current kids...lawyer says this is an ok purchase. Also need new computer. Was going to pay off some debt with tax return if I didnt do BK (CH7) Now, Im gonn aspend it on necessary items (NOT A VACATION!!) Lawyer says this is ok...do i have to worry, save receipts, etc?

Also - if I have about 3000 in bank acct, will they take it? Lawyer says 2k exemption for married couples cash only....should i just stock up on diapers and stuff liek that so i am set up after the BK when they take my money?

PLEASE HELP!!! When I say lawyer, I catually mean legal assistant I taled to on phone....I have an apt with lawyer this week, but I need to know the right questions to ask. And how will a CH 7 affect my foreclosure status in LV...People are stayin in hteir homes rent free for 7 mos on average here....Id like to take advantage of that (so I don't have to move the newborn right away) and i have no other place to go. When I do go, will I even qualify to rent somewhere?

Sorry for going on, but as you can see, i just need a little advice to get me on hte right path of being INFORMED!! Thanks to anyone who takes the time to read and respond

Hi, welcome to the forum. We had our tax return deposited and just went out and bought regular items. We bought clothing, groceries, diapers and anything that we could stock up on(toilet paper, paper towels, wipes, ect.) Also, get your car tuned up, new tires if needed, go to the doctor or dentist if needed. We also used the tax return to pay our lawyer. Hope this helps!

**OhioFiler** · 03-18-2009, 02:58 PM

Originally posted by okiemom2008 View Post

Hi, welcome to the forum. We had our tax return deposited and just went out and bought regular items. We bought clothing, groceries, diapers and anything that we could stock up on(toilet paper, paper towels, wipes, ect.) Also, get your car tuned up, new tires if needed, go to the doctor or dentist if needed. We also used the tax return to pay our lawyer. Hope this helps!

Stock up on baby supplies and baby clothes and baby toys and baby food....

**MiSSMaGoo** · 03-23-2009, 01:48 AM

hey so kind of a late reply but i havent been online... you should be fine if you spend your tax refund. I kept receipts just incase but was never even asked about it. I filed taxes Jan 16th received refund ($5000) Jan 30th and filed bankrupt on Feb 5th, I thought for sure we would be questioned about refund but we werent. Surprisingly the trustee even mentioned he looked at our refund and everything looked fine and that was the end of it.

**AfraidOfBK** · 03-23-2009, 06:56 PM

Thanks for the replies...we met with the lawyer who said the tax return shouldnt be a problem if we spend it rationally...this is TOO VAGUE for me...I dont want to be fraudulent, but i want my money to work for me, not lose it all to cc debt settlement that wont even make a dent....SO - lawyer said our CH 7 would be a breeze, but I not only have the $3600 tax return to get rid of, but also the $1900 a month I am saving on mortgage pmt.....I have been stocking up on baby stuff - diapers, wipes, got a high chair...I also nee a bunk bed (this will be girl #3 and theyll share a room)....I se this as a legitimate expense considering the baby coming in May and I'll be filing in June or July...

BUT - we also already bought a computer $1700 (much needed for my freelance writing and my son starting school in fall)..This, too, seems justifiable.

Now Im thinking of purchasing a kitchen table (ours is used and on its way out. Knowing that I will never be able to finance another big purchase in the future, I would rather pay for it with the money from the refund - I found one for around $600) Is this legitimate or luxury spending? Im not gonna take a vacation or anything in these few months, but I'd like to be set up as far as my household needs go....Also, lawyer said I wont get to keep money in bank accounts so I have to get rid of this too....Any suggestions?

**TEW** · 03-23-2009, 07:43 PM

This is what I spent money one.
Got the cars fixed tires oil changes tuneups that ate up about 2K
cloths food stock up
dentist, Glasses We took a vacation I don't know where in the BK code it says you can not...And we needed it. jsut don't use a credit card.
You are not in debtor prison do what you have been doing with out.

**eddiep** · 03-23-2009, 07:46 PM

This is the strangest part of bk! I don't get it! I know you can't take it with you when you die, but apparently you can't take it with you when you file for bk either!

Could you pay the insurance on your car for the rest of the year, or maybe you could increase your 401K or income tax deduction until the bk is over, it is like money in the bank.

Be careful that you do not have your money in an account where you owe money on credit card debt. There could be a cross collateral clause that would give the credit card company the right to take money right out of your checking/savings to pay off the cc debt. there are others here who have gotten burnt by this.

It sounds like your attorney is on the ball, ask him before you make any large purchases, or spend thousands in small purchases. He will know what the trustee will find acceptable and what would be considered luxury items. You are going to need money to move once the house is foreclosed on, so ask your lawyer if there is a way to prepare for this.

I was able to spend $500 on driver's education for my baby, not an issue for you I know, but my lawyer said that was not a problem, it was not considered a luxury item.

I am living life as I normally would but I am not willing to risk pissing off the trustee either. I may be stupid but I am willing to lose a couple grand to the trustee to get rid of my debt! So I would check with your lawyer before you spend off all your money.

Congratulations on the new baby! Enjoy every second, he/she will be taking driver's ed too before you know it!

**MiSSMaGoo** · 03-23-2009, 08:10 PM

I would sat $600 for a table is fairgame. I actually bought a $1700 washer and dryer 2 days before I filed and it was no issue. I think you will be surprised to see they dont look into your bank as much as you think they would. Not saying to keep money in there but hopefully to put your mind at ease cuz i know i lost lots of sleep over. And as far as using money for baby stuff you will be fine. I doubt when it comes down to it they will ask for proof on specifics. Most people just know babies are expensive. I had my 3rd child Jan 29th which 6 days before I filed bankrupt and my lawyer said if I were to be asked about my refund just state that I just had a baby and the trustee has common sense about those expenses.

Also for the $1900 extra a month get caught up on insurance maybe over pay a little on utilities. Also maybe investing on a safe since you will be renting (right?) soon and probably will need a deposit.

**AfraidOfBK** · 03-24-2009, 09:35 AM

THANKS!!! MissmAgoo, I willd efinitely be getting a safe and I agree that the fact that I am having a baby will justify a lot of things...but obviously I wouldnt be entering BK if I didnt have a totally different mindset as to what is luxury, you know? To me, you NEED a washer and dryer, but a kitchen table is LUXURY to us....so I dont want to make my trustee have a fit.

ALSO - if anyone can help me here: I am current on my cc's (dont plan to miss any pmts except mortgage until filing date)....can i still charge on them, small amounts? I am still paying min payments, but i dont want it to be fraudulent.

Also, does it matter when I prchase these big ticket items like bunk bed/mattress/kitchen table? Is sooner better, or can i wait until im ready?

What does overpaying my utilities accomplish? does it simply set me up for when i get out of BK so i odnt hav eusch high pmts? BEcause after BK i wont even be living at the same house.

AND about the house - assuming the foreclosure does not happen before bk, i will just be living in the house until ig et kicked out.....does BK make me moe sooner, (im surrendering the house in ch 7) will they tell me to get out by discharge date or within BK time frame?

ANy hep would be great, since I need to plan where to live with the new baby

THANKS

**MiSSMaGoo** · 03-24-2009, 03:42 PM

Well I really think you'd be fine to purchase a table... you are filing after May, right? So then in June sometime. Obviously dont get it on a cc and I probably wouldnt even use my debit card but if you have the cash just pull the cash out and purchase it. But I would say the sooner the better for now or really even after you would be fine b/c you will have time until you have to move out.

As for the cc's I wouldnt purchase on them... thats me though. Im not sure what exactly the rules are with that. My cc's were all 1yr past due when i filed.

For the utilities I had just said that if you were worried about the extra money from the mortgage... even if you pay 2-3 months ahead at least they're paid. If you're moving sooner then yeah i wouldnt but are you gonna try and stay at that house for as long as possible. If so you have time til you have to move.

And for the house I would say there is no way it would happen before you file.... Usually the soonest they even proceed with foreclosure is at 90 days past due which you would be right around there. But then again that is the soonest... my bank didnt even start until 10 months. However the bank might start it sooner than my situation b/c I was already 10-11 months past due when I filed bankrupt. So if they know you're filing bankrupt they might start it right at the 90 days since they no you dont have the intent to redeem. But even if they do you still have about 4 months until you'd have to be out but with the way the economy is and forelosures I'd bet you have more time than you;d think.

Hope that helps I know its a long answer but I feel for ya... I was so stressed being pregnant and going through my bankruptcy and move. If I knew then it was as simple as it was then I would have had a much easier pregnany so try not to worry too much and think of the happy outcome which is that lil baby. =)

**MiSSMaGoo** · 03-24-2009, 03:45 PM

Oh yea just to clarify the 4 months is after the 90 days past due... it's generally 4 months from the time your bank starts the foreclosure procedures... so really you're looking at sometime in October and thats on sooner than later side

**AfraidOfBK** · 03-24-2009, 05:03 PM

Thanks MissMagoo for all the advice...I am figuring the same thing with th ehouse situation....but tell me, what is the advantage fo paying for the table in cash rather than the debit? Wouldnt the debit be a better paper trail for where my tax refund went? And even if I take out the cash, cant they ask what I did with it? Should I save a receipt for it?

I am really trying not to stress, but i just dont want to do anything wrong and i dont want to mess it up, u know? I am so afraid they will view my "bankruptcy planning" efforts as fraudulent because i am putting so much thought into it....but i also feel like i have to protect mysel.....we'll see what happens! Thanks again

**keepmine** · 03-24-2009, 05:35 PM

You need to stop paying any debts you plan to discharge and use the money you were sending to creditors for living expenses. For sure, stop using the cards and learn to live on a cash basis. That's what you'll need to do post bk. May as well start getting used to it.

**AfraidOfBK** · 03-24-2009, 08:21 PM

That sounds normal, but if I stop paying all the debts I owe, I will have so much extra money just lying around.....then what?

The only reason i can afford CC minium pmts is because i am no longer paying my mortgage....Lawyer said stop paying cc's the day you file....is this a good call?

**keepmine** · 03-25-2009, 04:46 AM

Personally, I'd stop paying those cards the day I decided to file.
As to the extra money-that's what you use to live on.

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