cash transactions from checking and chapter 7

[Stressedout7]

Has anyone dealt with this scenario

Ok, have had financial problems for about a year, have not used any credit cards for over 2 years but after my husband got laid off in November he started working for himself. Well to get by each week until he got a check we would trade checks back in forth from one account to another until he got paid, well now my account looks like we deposited a TON of money which in reality is alot less and we would qualify for a chapter 7. Not only is this the problem but Im also afraid that since I was doing that Im going to get in trouble when this comes up in my bancruptcy? anyone have advise or been trough something like this and can tell me how they handle this scenario? Thanks, I m scared to death!

[denisejohn65]

My lawyer said I didn't need receipts either. He said to draw the money out and keep the bal low as I can. I only get alimony and rretirement right now and that is exempt right? I have NO RECEIPTS...341 is July 20th. I believe I'm a no asset case too. Will they ask for this? Since you can see on my statements where I've taken it out.

[Trixie007]

Hmmmm, I would re-think your explanation just in case you are asked! You were charging 1400 per month and spending 1000 per month cash - upon determining the need to file BK you start taking 4000 per month cash, which is 1600 higher? Those are some hellacious job search expenses - to the tune of $400 per week? Not saying you've done anything wrong, just that I wouldn't buy that reason on it's face.

[StartingOver08]

Ok, have had financial problems for about a year, have not used any credit cards for over 2 years but after my husband got laid off in November he started working for himself. Well to get by each week until he got a check we would trade checks back in forth from one account to another until he got paid, well now my account looks like we deposited a TON of money which in reality is alot less and we would qualify for a chapter 7. Not only is this the problem but Im also afraid that since I was doing that Im going to get in trouble when this comes up in my bancruptcy? anyone have advise or been trough something like this and can tell me how they handle this scenario? Thanks, I m scared to death!

One of the best things to do is plan your bankruptcy. One of the best cures for a situation like this is TIME. Let your accounts settle down. What I mean by that, is do not deposit any more of those checks. Let your six months or more go by using only one account and use the funds you actually receive from work.

This will help you in a couple of ways. First, you need to budget using your current income. If your income is not sufficient, then you really want to hold off on your bankruptcy until you have enough income to support yourselves. Remember, bankruptcy only takes care of the debt, not the income.

Second, by not filing too soon, you will show your actual income which is better to prove you are Ch 7 material rather than Ch 13. This is important to have your data ready in case the Trustee asks for it. I would plan on a min of 6 months with your accounts showing actual income only. JMO. This will make your filing more smooth. I would not want to show bank statments with deposits showing more than what your actual income actually is currently. Why invite extra scrutiny from the Trustee if you don't have to? Since the Trustee's ask for bank statements, you will need to start now and plan on filing maybe the first quarter of 2010 - maybe later. Some people have held off for more than a year.

[ska]

Ok, have had financial problems for about a year, have not used any credit cards for over 2 years but after my husband got laid off in November he started working for himself. Well to get by each week until he got a check we would trade checks back in forth from one account to another until he got paid, well now my account looks like we deposited a TON of money which in reality is alot less and we would qualify for a chapter 7. Not only is this the problem but Im also afraid that since I was doing that Im going to get in trouble when this comes up in my bancruptcy? anyone have advise or been trough something like this and can tell me how they handle this scenario? Thanks, I m scared to death!

I know just how you feel. We have three separate checking accounts. It used to just be two, but I was afraid that my primary account would be depleted of funds once I stopped paying on a CC that was from the same bank. My other account is a credit union approx. 45 minutes away without a debit card. I basically used that account to "try" to save money. If it was hard to access, I thought it would be easier to save.

Well, my husband gets direct deposit every week and the funds get deposited into two to three accounts. I do not have direct deposit so I would have to walk in my check. Well, the new bank wanted to put holds on it, so I would use the old account and withdraw cash and take it to the new account. What a pain! Well, after a while I realized that my old account was not taking my money, so I started going back to them.

Well, with the three accounts, I transfer money from the other accounts to the one. Plus, the account without the debit card gets my husband's funds a day earlier than the other banks. So, I can write a check from that account sooner and deposit it into my local branch. I guess it's just a way to get paid a day earlier too. I talked to my attorney and she said I shouldn't be too concerned, because I could show that I was just transferring money from one to the other.

After this is all over, I am loosing the newest account, they are a pain!