Sold car..will the trustee ask for anything?

[mikemike]

Ok i filled for chap 7 about two weeks ago and i am waiting for my 341 meeting date. Now right before i filed i told the lawyer i have a car that is paid for. When i registered the car i said i paid $4000 when the car was worth $8000. I recently sold the car for $7000 but the buyer also registered the car for $4000. I know theres an exception of $2500 for the car in my state of ny but is it possible they wont look into it? My lawyer said he didnt include the car in my papers. If they found out i had a car would i have to it back for the 7k? or 4k? Im confused here and wondering if anyone was in this situation. Is it possible they wont even find out i had a car or sold it? please help...

[shabam]

Do not tell me you sold it after you filed and did not include it in your petition? Not including an asset, let alone one recently sold is bad news.

Hiding assets is considered fraud in BK. I would get your lawyer to modify your petition immediately.

[mom2three09]

Why did your lawyer NOT include your car on your paperwork? I would think that is fraud. If it's registered in YOUR name then ofcourse it's going to be easy to track down. You sold a non-exempt asset 2 wks after filing BK -- I would guess the trustee will make you give him the $7K you received from the sale

[frogger]

please help...

No one but your lawyer can help you on this one. You need to get with him and tell him the truth a.s.a.p.

[backtoschool]

You need to do several things pretty quickly to keep your case from having issues and maybe being dismissed.

1. You need to add the car to your petition. Your attorney can amend your petition and still keep the case open. It is somewhat common to amend a petition before a 341, so that should not be an issue.

2. Selling or buying a car for under market value from an individual is a red flag for the trustee as it will look like an insider transfer. Get the kbb value of the car, and that is what needs to be exempted on your petition. If you do not have enough wildcard and car exemptions to cover the blue book value of the car, then the trustee is going to want you to pay the difference.

3. Trustee's regularly do asset checks and they could easily find the car. Bankruptcy fraud is a crime. If you do not disclose all your assets, and they find the asset, best case scenario they let you add it to the petition, worst case scenario they dismiss your case for fraud and charge you with a crime.

[Chowder]

Ok i filled for chap 7 about two weeks ago and i am waiting for my 341 meeting date. Now right before i filed i told the lawyer i have a car that is paid for. When i registered the car i said i paid $4000 when the car was worth $8000. I recently sold the car for $7000 but the buyer also registered the car for $4000. I know theres an exception of $2500 for the car in my state of ny but is it possible they wont look into it? My lawyer said he didnt include the car in my papers. If they found out i had a car would i have to it back for the 7k? or 4k? Im confused here and wondering if anyone was in this situation. Is it possible they wont even find out i had a car or sold it? please help...

Like backtoschool said, amend your paperwork including the car at whatever value your Attorney comes up with. Selling it for close to that amount should be ok.

Example. I had one car KBB and NADA had at close to $10k. It needed a bit of work, so I gave it a value of $6k. The Attorney "massaged" that number to what he knew the Trustee would accept, $5k. The exempted amount is $2500. The trustee, as predicted, let it slide without a question.

[mikemike]

wow...well i told my lawyer but he said dont worry about...i sold it before filing which is how i paid my lawyer...

[nerves]

If you sold it before filing and used the funds to pay for your lawyer, you will probably be fine. You need to be honest if they ask you how much you sold it for and be prepared to answer questions on where the money went.

[HHM]

wow...well i told my lawyer but he said dont worry about...i sold it before filing which is how i paid my lawyer...

If that is what happened, you are fine.

Although, there is a section on SOFA (Statement of Financial Affairs) where this would (should) have been disclosed.

[mikemike]

Yea i used it for the lawyer. And i do get $2500 exemption here in ny for the car so i hope i am fine. I dont have any money to pay the difference if they make it a big deal.