Questions about cash

[pandacb]

Since we stopped using the credit cards a few months ago, we have been "circling the wagons" pulling in every ounce of cash we can in order to pay the mortgage, etc. ... to make ends meet.

We met with the attorney and he said that stock we sold, because we took a loss on it, was not an income issue. But, we have to spend it on exempt items like bills and food...does that sound right?

Second, our second car is owned free and clear. The attorney said we could sell it and use the money for exempt items. Our house has deferred maintenence...some parts of it are literally falling apart. Are simple repairs like the replacement of worn/torn carpet considered legitimate expenses? This would help us, too, if we have to try for a short sale on the house.

Finally, the bk books and online info say that in Oregon you can have $7500 of exempt cash. The attorney says $800. He says that he has argued the $7500 in certain cases and it is tricky. I thought you could have an emergency fund but I guess I'm wrong. What kind of money, that's "tricky" is he talking about?

thank you, again, to all for your help

[justbroke]

Where do you get the $7,500 from? Oregon Revised Statute 23.160(1)(o) clearly reads that it's $400 per debtor.

Oregon Revised Statute 23.160(1)(o)

From my reading, the $7,500 can only be exempted if it came from the sale of personal property and it was banked. Presumably this is so that you can buy a new home. The reason most people get confused is because of ORS 18.348. In ORS 18.348, the statute reads...

ORS 18.348(1) Funds that are exempt from execution... remain exempt when deposited in an account in a financial institution as long as the exempt funds are reasonably identifiable

This just means that if the money was exempt -- like proceeds from the sale of a home -- and it's traceable and in the Bank, then it remains exempt.

That's why it's $400 per debtor in Oregon, and not $7,500.

Hope that clears it up for you. Yes, this is why you hire attorneys, because the law, especially in Oregon, is convoluted. I don't like those sites that simply say that it's $7,500, but let's look at one.

18.348 - Bank deposits up to $7,500, and cash for sold exempt items.

From: http://www.thebankruptcysite.org/exemptions/oregon.html

If you look carefully, it reads "for sold exempt items". That's something that everyone overlooks. They just see "bank deposits up to $7,500" and say... WOW... I can exempt $7,500 in cash!

[pandacb]

It is a matter of semantics, I think. The sentence, from my ignorant perspective, says you can have $7500 in the bank and you can have cash for sold exempt items. Of course, further research clears that up.

What is your feeling in regard to spending money on home maintanence?

[blessed]

Sounds like your attorney knows what he's talking about, at least in those three instances.

[justbroke]

It is a matter of semantics, I think. The sentence, from my ignorant perspective, says you can have $7500 in the bank and you can have cash for sold exempt items. Of course, further research clears that up.

It's not you. It's the website that tried to "paraphrase" the actual law. Nowhere in the actual law does it use the word used in the paraphrase.

What is your feeling in regard to spending money on home maintanence?

Deferred maintenance is always good. Fix the roof, do necessary repairs. Stock up on food. Buy some clothes. Fix the car. Get some deferred medical care - non-cosmetic -- done.

[pandacb]

thanks...very much

[WhatMoney]

You can also keep $7500 in cash from exempt income like Social Security in a bank account in OR, assuming you can prove the source is exempt. This applies to judgments too. I guess that means if you save over $7500 from exempt income you keep it buried in the back yard to keep it from the creditor.

[SMinGA]

About the home maintenance... What is your intention on the home? I ask because you mention a possible short sale. If you're going to file bankruptcy and give up the home - I think it may be poor planning to sink more money into it.

[pandacb]

As to the home, we are in the third month of a 3-month trial for a modification. In a perfect world, we would have the permanent mod in hand before filing and reaffirm. In reality, these "trials" are going on for months with no assurance of the outcome. Very likely, we won't be able to wait long enough and will have to deal with the bank's bankruptcy dept. - so all options must remain open.