6 months rule for creditor objection

[coolgurka]

I read the sticky on the 6 mths rule after a large cash advance. Wish i had read this before i made the ATM withdrawals from CC. I made two $500 cash advances totalling 1000 dollars in the Month of May with a card that will be maxed out within 200 dollars. Total debt on this Wells Fargo card is 11K

My total personal CC debt on 7 cards is about 100K. I have no assets and will be insolvent when I file BK Chapter 7. I also have a house I am foreclosing on(stopped payment Feb 1st 2009) I am in CA.There is a wells fargo 1st for about 180K and the second line of equity with Citicorp is about 150K.

Do I wait at least 6 months or should i wait longer to file BK given the situation I just described? Does the countdown of 6 mths start from May the month i withdrew the cash advances?

I am also worried that the 55K on the Amex (maxed out) will look suspicious(stopped paying in mar 2009 and they have been calling)

Someone suggested that I pay at least 2 minimum payments on the card that i had withdrawn the cash advances.

Can I get all the info to the BK lawyer and then wait 6 mths or more? Do i need to get all CC and bank statements for 2 yrs? 2 yrs starting from when??

What will happen if I don't have 2 yrs worth of statements fr the CC's (i only have online statements and they have stopped the online access)

All input of any kind is much appreciated

[DeadManCrawling]

What did you spend the advances on? If it was to pay other bills or creditors, you are probably ok.

Don't sweat it either way, if you end up waiting it out for these to fall off before filing.

We are well over median and haven't paid any unsecured in 2.5 years. One small judgement against my wife, 800 bucks, out of 25 or so creditors owed approx 150k unsecured.

They seem to have looked at our stats/files and realized how futile it would be to come after us.

Good luck with all!

[DeadManCrawling]

Oh, forgot:

If you are definitely going to file, I would not pay any more to any creditor, unless it is secured debt (houses, cars) that you need to keep. Pay them current.

Look to see if any loans are owned by the same bank/creditor. If they are, make sure you do not have any accounts like savings, checking and so on with them.

If you do, they can probably take money from your accounts to pay the other obligations and NOT EVEN TELL YOU.

There has been much discussion on the forum lately about this. It is called cross-collateralization or set off. I think.

Either way it's the same thing. If you stop paying say your boat loan, and have a checking account with them, they can clean out your checking account to pay for your boat payment, up to the point of taking ALL your money.

Hope to help!

[justbroke]

I read the sticky on the 6 mths rule after a large cash advance. Wish i had read this before i made the ATM withdrawals from CC. I made two $500 cash advances totalling 1000 dollars in the Month of May with a card that will be maxed out within 200 dollars. Total debt on this Wells Fargo card is 11K

The rule is $750 or more, within 70 days of filing (11 USC 523).

I don't know where you read 6 months? You may be confusing the "preferential" payment with the "do not charge anything 90 days before" general rule.

As the DeadMan wrote, things of a necessity should not be an issue at all... even if purchased the day before.

[coolgurka]

Thanks DeadmanC for the input.Yep, I closed my chase (formerly WAMU) bank account since I owe on 2 Chase cards.Opened up an account with the local credit union instead.


So I shouldn't 'waste" my money on paying the minimum payment on the Wells card that I had drawn the cash advances on? (If i file BK Ch 7)Someone on this forum on another thread had said that one should at least pay the minimum to show good faith and to mitigate the fact that the cash advances were made knowing i was going to file bankruptcy.

The cash advances were made for the case of paying other small debts (other cards) How does one even proof that this was the reason????

Can anyone answer my question about the 2 yrs worth of CC and bank statements? 2 yrs from date of filing?? What if I had already stopped paying and they(CC's) have denied my online access (getting online statements only)

[justbroke]

TCan anyone answer my question about the 2 yrs worth of CC and bank statements? 2 yrs from date of filing?? What if I had already stopped paying and they(CC's) have denied my online access (getting online statements only)

I don't know what you'd need that. The Trustee will let you know what they need. The Trustee usually doesn't want all that, but could ask for a variety of documentation. You deal with it as it comes in. I would get 6 months worth of bank statements and credit card statements, as that is generally the norm... if they even ask.

[coolgurka]

The rule is $750 or more, within 70 days of filing (11 USC 523).

I don't know where you read 6 months? You may be confusing the "preferential" payment with the "do not charge anything 90 days before" general rule.

As the DeadMan wrote, things of a necessity should not be an issue at all... even if purchased the day before.

Justbroke, thanks for the reply!! So if the cash advances were made in May i can file in august?

Should i stop using all credit cards end of May??

Should i get prepaid /creditdebit cards with Visa /MC logo for times when i have to buy something online?? That might look suspicious right? Should i then use my credit union ATM/debit card with MC logo and not get prepaid credit cards? How does one purchase those anyway??

Sorry if my questions seem stupid, I am so new to this and have tons of questions.

[justbroke]

Justbroke, thanks for the reply!! So if the cash advances were made in May i can file in august?

Technically yes, but there are caveats. For the most part, if you the charges are 90 days before filing and the cash advances are 70-90 days before filing, they don't get what is called a "presumption of non-dischargeability". (Let's just says it's 90 days for all charges/advances.)

What I write about "presumption" means that... because by definition, you are considered to be insolvent 90 days prior to filing... you can't incur debt when you're insolvent and get it discharged.

Should i stop using all credit cards end of May??

What I just wrote above needs to be thought about before I answer this question. Technically, if you are or know that you are insolvent and charge... then it's non-dischargeable. HOWEVER, and this part has more weight, the creditor would need to prove that you were insolvent and that's very difficult outside that 90-day "presumption" period. Most will not even bother. I charged things even on the day I filed (didn't know I couldn't keep any cards). I highly recommend you don't do what I did, as that was stupid.

However, the creditors never even thought about filing a motion to determine non-dischargeability for my charges. Remember, the lender has to take an action with the Court in order to do this. That's why most don't worry about small amounts.

Should i get prepaid /creditdebit cards with Visa /MC logo for times when i have to buy something online?? That might look suspicious right? Should i then use my credit union ATM/debit card with MC logo and not get prepaid credit cards? How does one purchase those anyway??

That's all up to you. I checkcards (debit cards) from two banks. I don't like the prepaids and have never used one.

Sorry if my questions seem stupid, I am so new to this and have tons of questions.

The only stupid question, is the one you don't ask... and then do something stupid.