Will this work?

[CCsSuck]

A little background first: I borrowed quite a bit of money from my sister in law, who also happens to be my boss beginning around September 2009. Without looking it up, I believe it was approximately 13k. This was used as a down payment on a house, closing costs, a down payment on a car, paying off a small line of credit, and replacing my AC when it died 6 months after moving in (ugh). In any event, I finally paid her back in full about two months ago. I was thrilled, because a) she was paid off, and b) because now my waiting period could begin should I decide to file chapter 7 down the line, which unfortunately is a very likely scenario. Before I get criticized for the spending above, let me just say this was all done before my credit cards jacked up my interest rates and cut my spending limits, and that at the time I was paying more than the minimums every month. The mortgage payment was less than my rent and it was also an investment, and the car was necessary as the one I had was falling apart with well over 100k on it and was costing me far too much to maintain. The line of credit needed to be paid off in order to get through underwriting for the mortgage, and the ac, well, that wasn't supposed to die for a few years, lol.

Anyway, I took my dog to the vet last week and she needs surgery on her thyroid. I have since let all but one of my credit cards go (and that one only gets me about $100/month), and I have about $6 dollars in my bank acct until payday, and most of that is already promised to different bills and food/utilities, etc. My sister in law has agreed to lend me the money if I need, but I really don't want to go that route for two reasons. A) I hate borrowing money -- it just reminds me that I'm a financial failure all over again, plus I have to pay it back (there's a large part of me that feels a creditor is way different than a friend!), and B) then the waiting period has to start all over again.

Here is what I wondering: I get a yearly vacation from work, with the option to work it and collect the money instead. I believe my boss will let me have it early, so I was thinking maybe I can get the business to pay the vet directly instead of giving me a vacation or check. That way I wouldn't have to borrow any money or pay any back so long as the vet bill is less than my vacation check would be (and supposedly it should be). Additionally, I'd normally get it in July and by then I could likely be facing one or more lawsuits from my creditors, so this way it keeps those funds safe, stops me from having to borrow money, and hopefully keeps my dog healthy. I think from the outside looking in, that should be fine. However, what I'm wondering about is could doing this potentially cause any issues for me down the line either with getting sued by my creditors prior to BK or while filing BK since I guess it could possibly look like I did something fishy with the money that I traditionally get each year, but magically stopped receiving when I started getting sued?

If for some reason this is a horrible idea, I could wait until the end of next month to do it, since I get paid 3x in April, so there's an "extra" check, but I really don't want to push this off a day longer than I have to for obvious reasons.

Any thoughts would be appreciated!

Thanks,
Mike

[keepmine]

You're going to need to delay your filing for at least a year since your last payment to your sil since, she fits the definition of an insider.

http://doney.net/bkcode/11usc0547.htm

without penalty, including any extension.

(b) Except as provided in subsections (c) and (i) of this section, the trustee may avoid any transfer of an interest of the debtor in property--

(1) to or for the benefit of a creditor;

(2) for or on account of an antecedent debt owed by the debtor before such transfer was made;

(3) made while the debtor was insolvent;

(4) made--

(A) on or within 90 days before the date of the filing of the petition; or

(B) between ninety days and one year before the date of the filing of the petition, if such creditor at the time of such transfer was an insider; and

(5) that enables such creditor to receive more than such creditor would receive if--

(A) the case were a case under chapter 7 of this title;

(B) the transfer had not been made; and

(C) such creditor received payment of such debt to the extent provided by the provisions of this title.

(c) The trustee may not avoid under this section a transfer--

(1) to the extent that such transfer was--

(A) intended by the debtor and the creditor to or for whose benefit such transfer was made to be a contemporaneous exchange for new value given to the debtor; and

(B) in fact a substantially contemporaneous exchange;

(2) to the extent that such transfer was in payment of a debt incurred by the debtor in the ordinary course of business or financial affairs of the debtor and the transferee, and such transfer was--

(A) made in the ordinary course of business or financial affairs of the debtor and the transferee; or

(B) made according to ordinary business terms;

(3) that creates a security interest in property acquired by the debtor--

(A) to the extent such security interest secures new value that was--

(i) given at or after the signing of a security agreement that contains a description of such property as collateral;

(ii) given by or on behalf of the secured party under such agreement;

(iii) given to enable the debtor to acquire such property; and

(iv) in fact used by the debtor to acquire such property; and

(B) that is perfected on or before 30 days after the debtor receives possession of such property;

(4) to or for the benefit of a creditor, to the extent that, after such transfer, such creditor gave new value to or for the benefit of the debtor--

(A) not secured by an otherwise unavoidable security interest; and

(B) on account of which new value the debtor did not make an otherwise unavoidable transfer to or for the benefit of such creditor;

(5) that creates a perfected security interest in inventory or a receivable or the proceeds of either, except to the extent that the aggregate of all such transfers to the transferee caused a reduction, as of the date of the filing of the petition and to the prejudice of other creditors holding unsecured claims, of any amount by which the debt secured by such security interest exceeded the value of all security interests for such debt on the later of--

(A)

(i) with respect to a transfer to which subsection (b)(4)(A) of this section applies, 90 days before the date of the filing of the petition; or

(ii) with respect to a transfer to which subsection (b)(4)(B) of this section applies, one year before the date of the filing of the petition; or

(B) the date on which new value was first given under the security agreement creating such security interest;

Something tells me you've not disclosed this to your attorney.

[chicagoannie]

My initial thought was you got a LOT of mileage out of that $13K! No judgment here.

I don't see a huge issue with using the week of vacation pay towards surgery for your dog, especially if your company will pay them directly.

You are going to have to wait to file for the reasons keepmine posted above. Depending how aggressive your CC companies are, they may or may not sue you late this year. When/if the lawsuits start, stall the proceedings for as long as possible to buy you time. With any luck you'll squeeze out that 12 months you need without any wage garnishments. (I can't remember if FL is a state that does not allow wages to be garnished - I'm sure an expert will add their thoughts to this thread.)

Don't keep any money in any bank where you have a delinquent credit obligation.

[bluemartini]

I'm sorry you are going through this with your dog. I have been there and I know how upsetting it is to need medical care for your loved one and to have trouble affording it.

IMO focus on taking care of the dog first. Everything else is variable. Maybe you will get sued and maybe you won't. I was never sued by any of my creditors after I defaulted -- well, except for the foreclosure judgment, but you know what I mean.

Maybe you will get sued, maybe you won't. The one thing you can be sure of is that your pet needs this medical attention. Get this settled and then re-group and figure out a timeline for your bankruptcy. It will happen when it happens. If it takes a little longer or a lot longer so that you can get your pet settled, then so be it. Just my two cents -- as you can probably tell, I am a major dog lover. (smile) Good luck.

[CCsSuck]

Thanks for the replies!

I think I may have confused some of you with my ramblings yesterday, lol.

I know that my sister in law/boss is an insider, and now that she's been paid off the waiting period is in effect before I can file BK without it affecting her. That is why I want to use my vacation pay from work (even though she is still my boss) to pay for the vet bill instead of borrowing the money from her directly. This way I won't actually touch the funds (the business will pay the vet directly) and won't have to pay her back anything.

So I guess my two concerns were, A) will doing this effect the current waiting period that started a few months ago when I finally paid her back everything I borrowed from her personally? and B) will having my vacation money paid from the business directly to the vet months early cause issues for me down the line with the possibility of lawsuits/bk if it looks like I stopped getting my annual vacation check?

Thanks again!

Mike

[daylate]

It would seem to me that you you should just get the check as always(but early) and pay the vet yourself. I'm assuming that it will be before the 6 months lookback. Either way it is income to you.

[df04527]

I think the issue is waiting a year from the last payment to SIL and if so then the dog issue isn't an issue?

[CCsSuck]

It would seem to me that you you should just get the check as always(but early) and pay the vet yourself. I'm assuming that it will be before the 6 months lookback. Either way it is income to you.

I was hoping to avoid having it in my name at all -- but that's exactly what happened. She wasn't comfortable writing the vet a check, because she couldn't justify it as a business expense (understandable), so she wrote it out to me. I took it to Chase to cash, because we use Chase at work. I don't have an account with them anymore because I owe them money for my credit cards, and they wanted to charge me 2%, nearly $20 bucks to cash it! I never thought I'd say it, but thank god for Walmart, lol.

I think the issue is waiting a year from the last payment to SIL and if so then the dog issue isn't an issue?

It would have been if I borrowed money from her directly which is what I was trying to avoid by getting my vacation check early. But then my concern was more could getting that check earlier than normal and spending it all cause me grief later down the line, because theoretically if I got it in July like normal, it would be within the 6 month look back period and by doing it this way, it wouldn't be. I didn't want to create a situation where it looked like I was trying to hide it or anything. Though I can't really imagine a trustee making a huge deal out of paying for necessary vet care. Its not like I was spending two grand to get the dog groomed twice a week or something for six months.

[CCsSuck]

Thanks again