My life is on hold

[fltoo]

Not to patronize you Chad, but it does and ole English teacher's heart well to see a person with good critical thinking skills.

I assumed the income from the fund was above the state income level and the lawyer knew this. Hopefully, anyway.

btw, you can sell an asset to anyone as long as it is for market value. Doesn't have to be a third party.

[chad9162]

Not to patronize you Chad, but it does and ole English teacher's heart well to see a person with good critical thinking skills.

I assumed the income from the fund was above the state income level and the lawyer knew this. Hopefully, anyway.

btw, you can sell an asset to anyone as long as it is for market value. Doesn't have to be a third party.

Thank you. And yes, I also hope the attorney gave sound advice. Many of the guru's here (including yourself) provide excellent advice not just on BK but on life as well. Making sure your income doesn't exceed your current expenses made total sense to me.

I actually sat down and did a budget to make sure I was living within my means. Sometimes people are looking for a quick fix without realizing that other things need to be fixed...I was one of them!! I have cut my expense and am actually saving money!

As for personal property, I know you can sell it to "family" but heard this can be a red flag. Sometimes trustees thinking you're trying to hide assets through family. But your right, as long as it is sold for market value, you should be fine.

[queenfluff]

Ironically, filing BK has not put my life on hold but instead has given me a better outlook on life. Although, nothing has really changed in my life.

As for some of your points on getting a job and selling personal property. I don't really understand. If you withdrew money from your 401K then it would be considered income for that month. Why continue to withdraw money from an exempted asset. Instead wouldn't it make more sense to get a job and use that money for living expense, money that is not protected.

Like fltoo said, as long as your under the median income for the means test I don't really understand your attorney's logic. At the same time that $3,000 could be paid back to the 401K, again protecting it. Unless you took out an enormous amount of money from your 401K that would put you over the median income, I don't understand. What if you put it back, would it still be considered income? IRS says you can withdraw money from retirement account for so many days before income tax is applied. I wonder if its the same.

As for selling personal items, I think its find as long they're exempt in the first place. You just have to show you sold it at Fair Market value and preferably to a 3rd party. Not a family member.

Most of the guru's here advise people to have an income that can sustain current expenses before filing BK, incase something else happens. After you discharge say you get a $5,000 medical bill. That could have been included in the BK. Not having a job is a big unknown after discharge. I can see why you are feeling your life is on hold.

Hi chad,

Thanks for your insights. I am not sure why my attorney is cautioning me not to get a job but he is. My guess might be because of how much money I have left in my bank account and my nonexsistant overhead (I have no kids either - I can't remember if I mentioned I am no asset case) .

For the 401K, I took out the last amount left of 5,000 in Feb 2009 and closed the account (I initially had around 15,000 which I took out 5,000 a few times in 2008 because I hadn't gotten a job and needed money for the bills - I had rent at the time.). I didn't decide to file for BK until just the end of March when I didn't get a job I was up for. I don't want to reopen the account and put the money back because I may need it for food and other neccessitites. My minimum payments per month for all cc debt was around $700 - so you can see that was shrinking what spending money I had left pretty fast every month.

I figured I only had a few months left than I would not be able to pay my bills anymore and I would have to default and do BK anyway. I didn't want to wait until the last minute when I had no $ left to pay the lawyer and fees and still no job. I guess I am saving the cc people some calls too.

So, unlike many people I wasn't looking that I might have to file BK for years prior - it was only in the back of my head since the beginning of this year. So, I didn't know that a 401K was exempt from it - I wasn't even thinking of it over a year ago when I first withdrawed from my account because I figure I would have a job soon. I didn't know back than the economy was going to tank as it did.

I had many good chances at jobs (good paying ones too) that would have saved me but because of the economy all the jobs I interviewed for the employers decided to freeze them and not hire anyone. I guess you could say that job wise I had not had much luck.

The whole idea of "just get a job" is not really applying in todays economy as I am sure you know. I wish I could have gotten any job before having to do this but I tried very hard (I applied for tons of jobs) and nothing. Believe me if I had gotten a job I wouldn't have done this. I normally have no problems getting jobs as I have lots of qualifications and a degree.

So, no more 401K money to take out any more. I guess I don't look at my 401K as a big deal - yeah, I owe money for my 2008 taxes (maybe that is another reason my lawyer is advising not to get a job - I owe on my taxes too - can't see why that would matter - just guessing on stuff here) but since I didn't have a lot in there and I really need it for living expenses I figure I should be able to get at it. It is not like that 15K was going to carry me through all the way through retirement anyhow. I am not planning to be one of those retired persons anyhow. I would be so bored...like I am now.

I need to call my lawyer anyhow - I haven't heard about my 341 date yet and I think I should have by now so I am going to ask for clarification on the job thing. Not that there are many jobs to get now though! But as I mentioned in previous post there is a chance that I could do some work for cash this summer. This way I won't put the $ in my bank account as income increasing.

I guess when in doubt follow your lawyers advice though. I can easily coast through the BK process with no job since I have no overhead and people to help me but I guess I just hate to be "limited" like this. It is like regulating my life.

[fltoo]

Another possibility might be that you are under the means test, but because of no bills, you have disposable income for the trustee to snatch.

[chad9162]

Another possibility might be that you are under the means test, but because of no bills, you have disposable income for the trustee to snatch.

Excellent point, didn't think about that. Maybe its that simple.

This is an interesting topic....on one hand you are "judgement proof" because you have no income for creditors to garnish. On the other hand if you get a "job" then you may have too much disposable income?

I know the guru's here caution BKing before acquiring a good job because you may incurred "new debt" that could have been discharged in a BK.

I understand your position better now....that you've been looking for a job but since you can't find one then BK was the only choice. I don't know how much you usually make, but maybe your attorney was concerned that if you got a job and factored in the 401K withdraws that would put you over the median.

What I'm curious about now, is since you "filed" in April your BK estate has been established including income. So why can't you get a job now? I mean they know you're going to get a job eventually. BK law says that the average of 6 months prior to filing is the income used in the means tests. Unless you start making a butt load money, I don't see why you can't get a job now? Would the disposable income come into play even though you have already qualified based on the past 6 months?

I would caution against "hiding" a cash job. If the trustee found out there'd be a lot of explaining....It'd be safer to wait.

[tatt2monster]

Hang in there! once all this mess is over with you'll feel soooo much better. I also have not started yet, but have been looking into this of and on for about 2 years now. I'd get so scared, that hubby and I would back off again.

But now we can't handle it anymore. Me worse then hubby, since I do all the finances. I'm up at night (pulled an all-nighter last night), researching. This seems to be a wonderful board - i'm glad I found it! so much information and the pp are great.

Good luck to you!
M

I can relate. And even though I feel some sense of relief (I retained an attorney today) I feel like I've been hit by a truck from all the emotional tension, my shoulders ache like something fierce. And I took a 2 hour nap in the middle of the afternoon, something I never do unless I'm sick. This has consumed 8 months of my life, and its going to be another 3 or 4 months before I get my discharge, but finally its a light at the end of the tunnel.

[tatt2monster]

What I'm curious about now, is since you "filed" in April your BK estate has been established including income. So why can't you get a job now? I mean they know you're going to get a job eventually.

Chad, I wondered about this too. Unless your next job is going to be a 6 figure salary, why would getting a job post BK filing be unreasonable?

[queenfluff]

Excellent point, didn't think about that. Maybe its that simple.

This is an interesting topic....on one hand you are "judgement proof" because you have no income for creditors to garnish. On the other hand if you get a "job" then you may have too much disposable income?

I know the guru's here caution BKing before acquiring a good job because you may incurred "new debt" that could have been discharged in a BK.

I understand your position better now....that you've been looking for a job but since you can't find one then BK was the only choice. I don't know how much you usually make, but maybe your attorney was concerned that if you got a job and factored in the 401K withdraws that would put you over the median.

What I'm curious about now, is since you "filed" in April your BK estate has been established including income. So why can't you get a job now? I mean they know you're going to get a job eventually. BK law says that the average of 6 months prior to filing is the income used in the means tests. Unless you start making a butt load money, I don't see why you can't get a job now? Would the disposable income come into play even though you have already qualified based on the past 6 months?

I would caution against "hiding" a cash job. If the trustee found out there'd be a lot of explaining....It'd be safer to wait.

hey guys, thanks your all your insights! Well, I called my lawyer today to find out what is going on with my filing. I signed all my papers on April 13 and he said he wanted to wait a week to file me just to clear out a few balance transfers. Not that the balance transfer were a problem since I was under $1000 but I think to make it look like less in that 3 month window. But his secretary told me he hasn't even filed me yet! I am a bit P.O'd.

I mean, I definately want to do what is best here even if I have to wait but why did he tell me a week and it has been almost 2 1/2 weeks. Honestly I didn't have much that needed to be cleared on cc's and signing on April 13 was just under the wire for me. I don't know about the logistics on this - but won't it look weird that I signed with a date of April 13 but it wasn't filed under 2 1/2 weeks later or maybe they don't care about that?

Ok, the secretary has just called me back as I was typing this - she said I will have a case number by this Friday so I guess that means he will file this week. I didn't get to talk to him so I don't know the reason of why he waited so long but at least it will get filed now. Hopefully he wanted to clear out some extra cc charges or balance transfers and it wasn't because he "forgot" about me and I had to call to remind them. I don't think I want to know. I know the lawyers are busy now but isn't this all done my computer now. Uhm, can you say Outlook reminder??

Hmmmm....but back to my job issue.

I wish I had copies of all my paperwork. I am trying to remember how he split up my income from the six months prior to filing. The only incoming income I had within the 6 months was the 5k I took out in Feb from my 401K. Even though at the beginning of the six month mark I had some money from my previous 401K withdraw that I did back in August 08 (6K), he said you only count incoming income within the 6 months and since I didn't deposit that 6K with the six month it didn't count (I think I had a little under 2K left and I changed banks because I moved). I think once he divided up my income was like $833-ish for each month. But I normally don't "use" all of that each month (althought I was as that was close to how much my minimums for all my cc's were $700 so that used most of that up), I use my $ as I need them. I moved from an rent apartment to a rent and utitlity free situation in November so I had more "disposable" $ after October. (I moved from Cali to Wisconsin).

My job field was IT before the economy crash - at my last "real" job before I got laid off I was making 54K and if I got a job like that again I would be making close to that or more (I should be making a lot more than that actually) - so yeah, I would have blown that median I am sure. Right now, with the economy, there are no jobs for my skill set in IT. Everything is on hold. I almost got a part-time seasonal job for $12 an hour working at the zoo (before I was in IT I was a zookeeper) but that didn't work out and after I didn't get that job was when I decided to do BK but the job market had really slowed down by that point and I didn't want to wait until it was too late and I had no funds left at all. I dont know if having that zookeeper job would have blown the median but it was only a summer job.

So, I am thinking if I get a IT job right now that I would be way over the median because it looks like I have $833 of income a month and no overhead (and now no bills because of filing the BK). The chances of me getting an IT job right now is pretty much non-existant and I can't afford to move for one.

So, that is what I think the reason is but I am not sure. But I did put down stuff on my expenses per month which just food, internet, pet care, a little for transportation (bus, gas for car borrowing), cell phone (which I am declaring on my debts so that will be gone) and I think that was it. I can't remember the total but I guess it looks low. So, some of that $833 would be towards my low overhead and monthly expenses but there is some left over.

I haven't been taking out much money out of my checking account because after I filled out my paperwork my bf got approved for food card - even though it is just for one person amount - we shop together. But I was realizing yesterday that I am worried about the amount I have left in my account - Can they try to get some of it? Even though I am not spending much on food right now (I have a special diet so I do buy some special stuff online and I buy pet care and other things with my debt card) I should take out the amount I specified on my sheet every month to look I am still needing my money for groceries etc. I think I put $250 or $200 but it varies some months.

Would it be a good idea to withdraw the cash I would be paying for food out of my account every month so it looks like I am still buying my groceries even though right now I am not? My bf may not have the food card (stamps) for too much longer because he is trying to get a job right now. I have too much money in my account right now to qualify for my own food card.

I want my expenses that I put on my paperwork to match my spending right? I would rather spend my left over on myself and my expenses than give it to the trustee. I mean, they can't leave me with nothing right? The cc's have plenty of my money already in my opinion.

Plus, my banking account is Chase and two of my cc's I am getting discharged are Chase card - the balances on my are under 2K each card so not a lot. My lawyer told me that Chase can't go in my banking account to get my money to pay my Chase cc's after I file -I hope this is true. I think I would like to keep my Chase checking account for a bit but will close it eventually. But from reading on here I know I have to be careful about switching banks around.

[Recessionist]

Don't count on any creditor not raiding a checking account you hold with them - I have read enough here to know they do it all the time.

[queenfluff]

Don't count on any creditor not raiding a checking account you hold with them - I have read enough here to know they do it all the time.

So should I go and close my Chase account and take all my money out? I don't want to raise a flag. I have 3K right now. My lawyer said my checking account was protected. My cc's are paid current until when they are due next week and no default.

Did you have a cc do that to you?

It seems wrong for them to take your left over money that you need to buy food - I mean, you have to some living expenses.

[chad9162]

So should I go and close my Chase account and take all my money out? I don't want to raise a flag.

Its not a red flag. You do need to show exact amount in checking and savings account on file date since its included in the BK estate. Since your attorney said the money is protected then its probably exempted under state or federal exemptions.

Your attorney is correct when he says Chase can't take money to pay your Chase debts after you file because of the automatic stay. Since you're current then Chase won't touch your account in the mean time. But if you were past due then they could.

I wouldn't worry about matching expenses or anything because it appears you money is exempted.

[chad9162]

Oh and since you are Bking Chase....yes I'd eventually change accounts

[queenfluff]

thanks chad! I feel better. On some of the other threads, people were saying about how BoA will snatch your money out of your accounts to pay your BoA cc. So, I got worried.

Well, I just checked and my Chase cc's are due today and tomorrow. The minimum amts due are small 32 and 30 dollars.

Now, after going over my charges on my one Chase card I think I see why my lawyer waited until this week. It will clear off a few more charges that would have brought me slightly over $1000 for 3 months. Fine with me.

How quickly does the stay go into effect?

I am assuming if I have never been late before and I am like two days past due they won't immediately try to take money out of my checking account - does it take a while before they decide to do that (if they do)? If so, once they tried it than I am sure that stay would be in effect by that time. Well, I guess I can just cross my fingers. Eek!

I am just wondering because I am now getting filed around the same time my bills are due. Cutting it close I guess. The Secretary didnt tell me what day the exact filing will be but since I will have the case number by Friday it will be any of the next few days.

Any advice as of when I should close my account? I can't go to Chase, BoA or Citibank. Will other banks know that I am in middle of Bankruptcy? Just wondering if it will be difficult to get a new account at a new bank. Maybe a credit union eh?

My lawyer didn't say anything that I need to switch banks - obviously he knows that I have the Chase checking and cc's that I will be BKing are Chases too and that soon I will be past due.. Hmm....wonder why.

[chad9162]

How quickly does the stay go into effect?

The day you file....

I am assuming if I have never been late before and I am like two days past due they won't immediately try to take money out of my checking account - does it take a while before they decide to do that (if they do)? If so, once they tried it than I am sure that stay would be in effect by that time. Well, I guess I can just cross my fingers. Eek!

I think you'll be okay, unless you have autopay haha. No usually banks don't go after accounts until you're like 2 payments behind.

Any advice as of when I should close my account? I can't go to Chase, BoA or Citibank. Will other banks know that I am in middle of Bankruptcy? Just wondering if it will be difficult to get a new account at a new bank. Maybe a credit union eh?

Once you file the stay will protect you. So no hurry to close account. What I would do right now is go and open a new account before you file this Friday, cause then it won't matter if you're in BK or not. Just look around and find a decent credit union since they don't charge a lot of fees. Some offer free online banking and bill pay etc. Just pick one that isn't included in your BK.

My lawyer didn't say anything that I need to switch banks - obviously he knows that I have the Chase checking and cc's that I will be BKing are Chases too and that soon I will be past due.. Hmm....wonder why.

Well he probably didn't say anything since you were current and by the time you were late you'd be protected by the stay. But yes most attorneys advise their clients to switch banks if you are including them in BK. Chase may limit you account access ...like take away online banking etc....

[chad9162]

You know what, I just realized you are a female "queenfluff" haha