Do we have a chance at Chapter 7?

[PhxGuy520]

PhxGuy,

It's not all about the means test.

The way the new laws have been discussed in the media, you would think that passing it and being below the median would be a "slam dunk."

If I were a lawyer (which I'm definitely not), I'd be stressing two things. Analysis of income (means test) and analysis of assets (exemptions.)

To simplify cases to apply to the majority (or the majority I perceive), people looking at BK are concerned about whether their income qualifies and whether they can keep their two primary assets for shelter and transportation--home and car. Thus, having an income below the median is only half of the "slam dunk." The other half is proving that the value of your home and car do not push you past the exemption limits for your state. They are going to look for any non-exempt assets to go after.

The thing about it is she really has nothing...

We put the truck in my name yesterday. But we will be honest with the court when it comes time to claim it. I have the contract stating I made payment, as well as some cancelled checks. If they take it they take it, but I am not going to make it easy on them.

She does not own a house, she is not even on a lease. She lives with me, but the rental is in my name.

We shared a checking about until yesterday. She is gonna have her own account and give me checks for half of everything so we have a paper trail of payments made.

She has clothes a 19 inch TV and thats it.

The only open question is would they consider her a household of 3 or 1. We have two kids together, but I claimed them on my taxes the last couple of years. I cant see that be the deciding factor since they are still her kids, and I could die tomorrow, but who knows.

[Minnymouth]

Okay,

You are making some TERRIBLE MISTAKES HERE........

1. Putting the truck title back in your name. You cannot transfer assets within 180 days of filing - looks fraudulent....

2. Taking her name off your checking account. That is considered fraudulant also....

Since she is filing separate these two above proceedures canl result in dismissal of her case....

Legally to the bankrutpcy court the truck is her's and it looks like she's trying to hide a paid in full asset by transfering it back to you...

Same thing with checking account.... if you shared it... half of it is legally hers....

You need to do a great deal of more reading of the Bankruptcy Manual Vol II on this forum, specifically telling you what you can and cannot do during the bankruptcy process....... or your going to "screwup her chances of a successfull bankruptcy" in the process of trying to help her.....

Do a lot of reading, contact at least 2 attorneys (free consultation) and discuss what her options are and let them know what you have already done with the truck and checking account.....

See what they tell you......

Keep us posted on what you do.........

[SinkingFast]

Big mistake transferring the title to the truck. The Court looks at all property transfers in the last year. They wanna know who the property was sold to, for how much, and why.

It's not a case of them taking the truck anyway and you not making it easy for them. You just set your GF up for a case of fraud. The Court can view the transfer as a fraudulent transfer of an asset. That can get her BK dismissed with prejudice. Meaning she cannot refile.

BK is serious FEDERAL business and the Court does not take this lightly. You are not playing a game of tag in the school yard with a bunch of classmates. This is their game and their rules on their court/field. And transfering the title to the truck just because you say it's really yours and you can show payments made may not cut it with the Court. You just made your GF's attny's job a heck of a lot harder. You might even have cut yourself out of being accepted as a client by some very good BK attnys.

Taking her name off your checking acct may be OK as long as you are the primary on the acct. The bank reports according to the primary's SS#. The Trustee could find your bank accts thru a SS# search and declare them assets in GF's BK so you'll want to allow months to pass before filing BK.

Wanted to add,............

She'll be a household of 1. They will go according to how your GF has filed her taxes in the past. Since she's not been claiming the kids, the BK Court probably won't allow it either.

[PhxGuy520]

Half of nothing is still nothing.

I dont plan on hiding anything. I will be honest when they ask about the truck. If they want me to transfer it back I will. Again I dont think this will be seen a clear cut case of fraud. I have multiple legal documents that state I paid for the truck. If they dont see it that way and the trustee wants me to change it I will. But we have not even spoken to an attorney yet so who is to say we are even thinking about BK.

Same with the checking account. She is going to have to show back bank statements. She will show them for my account and hers. This will only better divide my money from here and give us a clear paper trail of what she pays a month and what I pay a month.

She is just about the appeal her judgment so it will not be like it we did it right before the BK. I think it will be a few months before she does it.

Again I am not hiding anything. I plan on being honest with them about everything. If they want us to move things around I will.

From what I have read is that they only dismiss it if you try to hide it. As long as you are honest with them I think we will be ok. I am sure we are not the first couple to get sued and then make bad decisions in the eyes of the trustee.

[Minnymouth]

Just maybe you will strike it lucky with the Trustee and he will believe you when he starts your case......
Yeah, don't hide anything, be honest about it..... and just let them know that you sure didn't know that your couldn't do transfers etc right before bankruptcy......

Hope it works out okay for you.....

Keep us posted.....

[SinkingFast]

It's easy to say you won't hide anything and that will make it alright. But that's just not the case sometimes.

You said you haven't even chatted with an attny.

Let me tell you a little story.

We owed $8100 in taxes to the IRS for taxes for last year. 2005. We had a truck with enough equity that we could do a cash out refi to get the money to pay the taxes. That woulda done 2 things for us. Paid the taxes and protected the equity in the truck so the Court wouldn't sieze and sell it. Attnys all said NO. Taking on more debt on the eve of filing BK would look fraudulent to the Court. No matter that we could explain needing the money to pay the IRS for taxes we owed.

We wound up having to sell the truck to pay the taxes. Which won't make the Trustee very happy either. The Trustee just lost a rather juicy asset he/she could sell to make money off of. But the money went to a Secured Creditor and a Priority Debt. The Trustee cannot go back to the Secured Creditor, and no Trustee in their right mind is gonna go up against the IRS.

But still, we're going into BK Court with a potential burr already under the Trustee's saddle. Not a pleasant thought. But it was sell the truck and pay the taxes or take on an IRS tax lien. Selling the truck was the least upleasant of the 2 options there.

[aa06a47]

[/quote]But still, we're going into BK Court with a potential burr already under the Trustee's saddle. Not a pleasant thought. But it was sell the truck and pay the taxes or take on an IRS tax lien. Selling the truck was the least upleasant of the 2 options there.[/QUOTE]

I doubt the trustee will let that burr stay in his saddle too long. If selling the truck was the correct thing to do to pay the IRS, then what can they say?

[aa06a47]

[QUOTE=PhxGuy520]

Well, just the fact she transferred the title out of her name back to yours represents the intent that she is trying to hide an asset. Take yourself out of the equation, your not the one filing. They won't even want to hear from you until you tesitfy in court on her behalf.

The fact is, you are transferring the truck in your name to keep the courts from getting it...if it is in her name, it is bye bye baby.

The 2n fact is, bank accounts, her names suddenly taken off...and by the way, the same time she transferred the truck away to a friend / family / boyfriend...

Dude, I'm not by any means making any judgement. But there is too much "separation" going on here for a judge or a trustee to believe anything other than trying to avoid giving assets to the BK courts. They are not going to believe the "I'm really not trying to hide anything" argument.

Another thing, don't think if you get caught and then say, OK, you want the truck, you can have it. People can go to jail for BK fraud.

Look back period is a year. I would say, get your affairs separate now, and help her pay her bills for a year before filing. Good luck with it.

[SinkingFast]

But still, we're going into BK Court with a potential burr already under the Trustee's saddle. Not a pleasant thought. But it was sell the truck and pay the taxes or take on an IRS tax lien. Selling the truck was the least upleasant of the 2 options there.[/QUOTE]

I doubt the trustee will let that burr stay in his saddle too long. If selling the truck was the correct thing to do to pay the IRS, then what can they say?[/QUOTE]


Not much the Trustee can say. We paid a Secured Creditor, the Lender on the Truck, and a Priority Creditor, the IRS. Not like we pocketed any profit on the deal. But the Trustee can still be a bit peeved about it.

Our attny asked if we had our tax issues resolved. We said Yep! And told him how. The attny said the Trustee's not gonna be real thrilled but there's not much he/she can say about it.

Trustees can be decent people. Folks have told stories of good experiences with their Trustee. But, Trustees are not our friends. And by no means do you wanna piss off your Trustee. They can make your life a living He##!

[FoolAndHisMoney]

[QUOTE=aa06a47]

Look back period is a year. I would say, get your affairs separate now, and help her pay her bills for a year before filing. Good luck with it.

Look back period for vehicle transfers is now 2 years, so Phxguy she would have to disclose everything even if she plans on losing the truck or waiting 2 years from today to file. Since your here now I imagine she wants this done before 2 years.