Advise on settlement needed please

[BlueBuffalo]

I have a situation I need some advice on.....
My husband and I have been preparing to file chapter 7, my husband is unemployed and I receive alimony and child support from my ex. $77k year.
My ex and I have a payment agreement that goes through 2020. His company went bankrupt about 5 years ago and he had personally guaranteed many of the loans totalling in the millions. He lost his last appeal and the guy coming after the money will be filing a judgement very soon. In order to protect the money he owes me he wants to settle up and pay me cash now, less than he would pay over time but the cash payment now is going to be about $200k if I take it, if I don't take it then I will probably never see any money from him again. If I take it and pay my creditors and back taxes that are dischargeable I will end up with nothing left over.
He mentioned something about putting me as a first lien holder in his business before all the other creditors but wouldn't that be considered an asset?
We haven't spoken to our attorney yet as this just came up yesterday, just curious if anyone here has any ideas on how I can protect this money....it is just a prepayment of child support and alimony.
If I put it in a trust would that protect it?
Thanks for your help.
Is there any way to protect this money?

[HHM]

You need an attorney.

I am a little unclear about what your ex is "settling up" with you. Is it the future child support or alimony, or some other debt?

[BlueBuffalo]

He is supposed to be paying me 77k per year for another 2 years then 32k per year for another 7 or 8 years I think it is. Because of this forthcoming judgement he would like to pay these years in advance (at a reduced rate) to be certain I get the money for the kids because he does not know what will happen to him financially after dealing with the judgement. So it is future child support and alimony.
I do have an attorney, I have a call in to him but I like to be prepared with questions and ideas when I do talk to him.
Does this make more sense? Sorry if I was confusing before, I find it difficult to describe our situation.

[BlueBuffalo]

I spoke to my lawyer and he said I could purchase some property because that is protected up to 300k, only problem is then I have to sell it afterwards and hope it sells fast and I don't lose anything. So it looks like I will be able to get the money right away afterall.

[AngelinaCat]

You need to talk to your lawyer again about setting up a Family Trust for the children. They are minors, are they not?

That money can be put into a Trust that is for them with you and/or your current husband and/or the ex as trustees. You as trustees administer that Trust for the children, but it does not belong to you, or to them. The Trust is a seperate entity, out of which you can disperse funds for their schooling, clothing, etc. You must keep very good records of this.

The problem with something like this is that with the ex so close to having a judgment nailed onto him, and you being so close to filing BK, there may be--and probably is--a time period in which this could be undone, because of the appearance of hiding assets.

I will see if I can find some more info for you.

[OhioFiler]

How much is alimony and how much is child support?

[BlueBuffalo]

Angelinacat, thank you for that info. I will bring that up with my lawyer tomorrow when I see him.

Ohio, 29k per year is child support and 48k is alimony.

[AngelinaCat]

This link gives some additional information, and is one of the more understandable of the pages I have searched:

http://www.diyestateplanning.com/living-revocable-trusts.html

[BlueBuffalo]

Angelinacat....that is a great site and a great article. THANK YOU for taking the time to find that for me, that was awesome!!! I will definitely bring this article with me tomorrow and see if this is a viable option instead of the real estate purchase.

[jribe]

Angelinacat....that is a great site and a great article. THANK YOU for taking the time to find that for me, that was awesome!!! I will definitely bring this article with me tomorrow and see if this is a viable option instead of the real estate purchase.

what i will say is to speak to a qualified attorney. This could be a very sticky situation.

Did you have a messy divorce? Or were things ambicable?

There are some people that would say something is going on, and get the other to sign off on an agreement that is not in their best interest. I do not know if this is the case.

Child support and ailimony are priority debts- you have good standing with your current agreement.

It would only be lowered if he went to the court and asked for a lower amount to pay to you. It does not automatically happen because he has a judgement.

Look up the state statute for garnishments - here in CA - it is 25% that can be taken from wages.

Again- please be careful and speak to an attorney before agreeing to anything (even verbally) and definitley do NOT sign anything!

[frogger]

One of the specific questions that I was asked by my lawyer was "Have you set up any kind of trusts within the last year"?

Be careful. With the time constraints crunching on you as they are, most anything is going to look like you are hiding assets.

Good luck.

[BlueBuffalo]

Met with my lawyer today and unless the trust was set up over 5 years ago it won't be protected. So now my lawyer and the ex's lawyer are talking to see what can be done. Thanks for all the responses....I hope to know by middle of next week as we were ready to file next week and I would really like to move forward with that.

[Shakin]

Timing is everything.........listen to your lawyer but dont be agreeable I would almost seek proof in everything in your situation. You have alot to lose.

Timing...........