One uncleared check = Now an asset case

[mommyblonde7]

I am so frustrated. My landlord held onto my January rent check for over a month before cashing it. I filed a no asset Chapter 7 on January 31 and my lawyer said that even though those funds were still sitting in my account, the trustee wouldn't take them because they had already been spoken for. He said that the case law stated the same. I would have waited to file until after the check cleared but my electricity was about to be shut off so I had to rush.

Well, I go to my 341 on March 15 and the trustee immediately looks at my bank statement from the date of filing and says that he believes the funds are an asset. I provided him with copies of the canceled check and an e-mail from my landlord stating he'd forgotten to cash the check, etc. - no dice. He filed his report yesterday stating that this is now an asset case and gave the creditors until June 30 to file claims.

I was so hoping to be done with this nightmare by the end of May - but it looks like it is going to drag on for awhile. I know my lawyer wants to fight this which means it will drag on even longer.

Lesson learned - if you are considering filing for BK, keep your personal check writing to a minimum. Use cashier's checks, money orders or cash. You never know how long it will take those checks to clear.

[IamOld]

BUT - couldn't you EXEMPT those funds? I mean if your state has $X as exempt cash, could that simply have not been exempted if your balance is less than X? DOesn't EXEMPT cash, EXEMPT whatever, not "count?????"

[mommyblonde7]

The cash exemption in my state is a whopping $300. There is no "wild card." In my check register, my account balance was under $300 on the date of filing so I thought I was in the clear (per my attorney's advice).

[carlsbadmike]

I had to remind my landlord to cash my check before my 341 meeting, for 2 months rent to bring me below the maximum allowed in checking on day of filing.

[IamOld]

The cash exemption in my state is a whopping $300. There is no "wild card." In my check register, my account balance was under $300 on the date of filing so I thought I was in the clear (per my attorney's advice).

Holy mother!!! And I think my state hates its own citizens? That's insane!!!!!!!!

[daylate]

Unless your rent is 5k, and even then, some trustees are definitely not nice people.

[olivies]

Lesson learned - if you are considering filing for BK, keep your personal check writing to a minimum. Use cashier's checks, money orders or cash. You never know how long it will take those checks to clear.

That really stinks! So now your landlord has to give the money back?? And then what- file a claim??
As for the cashiers check, money order and cash- our trustee wanted to know where all our cash withdrawals were going to when we filed. Ummm....to pay the attorney, landlord, utility company, etc. You can't win sometimes.

[mommyblonde7]

That really stinks! So now your landlord has to give the money back?? And then what- file a claim??
As for the cashiers check, money order and cash- our trustee wanted to know where all our cash withdrawals were going to when we filed. Ummm....to pay the attorney, landlord, utility company, etc. You can't win sometimes.

My attorney said that if the judge approves this, I would be the one who has to pay the money back to the trustee to be split among the creditors. So stupid! Like that amount is going to put a dent in my unsecured debt. He didn't think the judge would approve it because it goes against the whole "fresh start" philosophy so we will see. My attorney does not typically practice in my county so he is not as familiar with this trustee as others.

Oh well, I just want this to be done with. I guess I shouldn't complain too much - there are others who have to deal with much worse.

[CoBelle]

Sorry that you are dealing with this....seems so unfair and piddling doesn't it?
I'm in a similar sitch and have always wanted to ask, so I will on your thread:
what if the bk court says she has to pay but she doesn't have any nonexempt income coming in? (this is my sitch). What can it take?
Ihave nothing left but exempt money...can the bk court make you pay them with exempt funds like social security?

[mommyblonde7]

Sorry that you are dealing with this....seems so unfair and piddling doesn't it?
I'm in a similar sitch and have always wanted to ask, so I will on your thread:
what if the bk court says she has to pay but she doesn't have any nonexempt income coming in? (this is my sitch). What can it take?
Ihave nothing left but exempt money...can the bk court make you pay them with exempt funds like social security?

I wish I knew the answer to that question, CoBelle, but I don't. I do know that when I asked my attorney how I was supposed to pay the trustee money that had already been spent (rent) he said it wouldn't have to be paid back in one lump sum. I could pay in installments. I really hope I don't have to pay anything. I have some tax debt that is considered a priority claim and the state department of revenue already filed a claim. I would be paying them back anyway so the tax debt will (hopefully) end up canceling out this whopping $1000 that the trustee wants me to pay him.

[free2breathe]

Holy mother!!! And I think my state hates its own citizens? That's insane!!!!!!!!

That's nothing, in my state there is NO cash exemption, nada, zilch. Earned Income Credit is fair game, child tax credit....you got it, fair game! Trustee took most of the tax refund. We had under $300 in the account on the date of filing....BING! Trustee took that too...add in 25% of the earned but unpaid wages. Thank goodness we're past that, just sitting here biding our time until the final closing of the case. I'm over it, just glad to be starting over and moving forward slowly, s-l-o-w-l-y. lol

[IamOld]

Oh my God, I know your tag says private, but I would love to know what that state is just to stay out of it!!!! That's insane!!! I mean taking $300 from you? Trustee made 10% of that $30 bucks? It's going to cost the "system" FAR more to process that than the $300 - the "gov't" is going to lose money on that!

[free2breathe]

Yes, it almost feels punitive when they nitpick at the numbers. The percentage of the value of claims filed that is actually going to be realized by the creditors is laughable. I guess every little bit must add up for some of the trustees though, because some of them seem to be REALLY meticulous about scraping the bottom of your barrel.

[mommyblonde7]

Oh my God, I know your tag says private, but I would love to know what that state is just to stay out of it!!!! That's insane!!! I mean taking $300 from you? Trustee made 10% of that $30 bucks? It's going to cost the "system" FAR more to process that than the $300 - the "gov't" is going to lose money on that!

Yes, that is WAY worse than what we have here!