Sold/Transferred Car

[CaptClink]

I had three vehicles. One an older Honda that I sold for $1500. Not much of a car but it still ran. The second was an old vintage Chevy that I transferred to my dad. It did not run, had no interior and probably a value around $2000. This was all done about a year ago and now I am looking at filing chap 7 bk. Will this be a problem?

PS the $1500 is long gone to pay for expenses and I got nothing for the Chevy. I just could not afford it any longer.

[CaptClink]

Let me give some more background on this.... The third vehicle was a minivan which I still have and was purchased about a year and a half before I sold the Honda for $1500. We had another kid and five people just did not fit in the Honda with car seats and all. My wife does not drive so the vehicle was excess. The Chevy that I transferred to my dad was originally purchased together with my dad. My dad and I bought two vintage cars about 30 years ago. About 5-10 years later, he took one and I transferred one into my name. The car I took was purchased from my uncle and was more of sentimental value than anything. As I said, the money from the Honda is long gone.

[keepmine]

The sale of the Honda is no problem.
The sale to your Dad may be if you file within 1 year of the transfer. Of course the dollar value is so low the trustee mat not be interested.
Be sure you disclose this to your attorney.

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

[despritfreya]

The transfer to dad is not "preferential" as it was not done to satisfy an antecedent debt as contemplated under 11 USC 547. It is a transfer that is not in the ordinary course of business and/or your financial affairs. As such it must be disclosed when answering question 10 of the Statement of Financial Affairs. The "look back" period is two (2) years. If the Trustee sets it aside he is doing so under 11 USC 548 as you did not receive anything of value in return for the transfer.

If the vehicle you gave to your dad has little or no value (was it really worth $2k) the Trustee will most likely leave it alone. However, that decision is up to the Trustee and if he comes knocking you and your dad have no defense - the Trustee gets the vehicle, for whatever that is worth.

Des.

PS: The Honda sale is also listed on question 10 but it sounds like you got fair value in exchange so there is no issue.

[discouraged]

I'm sorry but let me remiond you of the case where the vintage car was questioned by the trustee. It does depend on the actual value of the car as vintage cars. when remodeled, are much more valuable.

Just make sure you don't get yourself into a situation where the value of the car is not what you proclaim. Talk to your lawyer about the ramifications, if any, this could bring.

[drowning123]

A year ago? What are you worried about? Just don't bring them up. The trustee usually asks what you did in the last months and that's all you need to account for.