Advice needed about auto.

[ldw1964]

I will be filing in couple of months chapter 7. I have a friend that has loaned me some money in the past and I will have to include him in the filing. He has agreed to loan me some more money to help me get through the couple of months, but will use my car valued at around $10,000.00 owned free and clear as collateral. My state exemption is $5,000.00. He will loan me around $6000.00 to meet expenses. The check will be deposited and I will use it for household. A lien will be put on my car by him. I am worried that the trustee will see this as wrong since it is just a couple of months before filing and he is also a creditor. My atty says that it is okay as long as it is new money. Has anybody been in this situation?
Loosing sleep, first day on forum, any advice would be very appreciated.

[momofthree]

If you have to borrow $6k just to get by the next 2 months, you have problems that bk will not solve. Are you working?

[pamkev]

Are you still paying cc bills if so stop

[Drazil65]

Hi, could you possibly give us more info on your situation? Are you working? Do you own a home or are you renting? Why are you borrowing money to get by? Sorry but you will get a lot of experience and suggestions here but we need more info...

[SMinGA2]

It sounds like you're 'selling' the nonexempt equity to a 'friend' to protect it from the trustee. If you really do need the money to get by, then you're going to continue to have financial trouble after filing. Unless you have more friends willing to loan you money?

If what you intend is just a ruse, I think it could lead to trouble even if you have a paper trail. If that is your goal - be careful...

[ldw1964]

Thank you for reading. I had a good job about a year and half ago and was able to meet expenses. When I lost it I went to work for a company I love, but make only about $19,000.00 a year. The money against my car would allow to catch up on a house payment, make the current one, and one after that. Once the bk is over should I get a discharge I plan to rent my house out or get a couple of roommates and that will allow me to make the payment on stay on budget. It is my house payment that hurts each month. Have thought about selling too and may have to consider that. If I sold now, and someone bought, I might break even with what is owed after realtor fees and closing costs. So it is not a ruse, but still concerns me giving the timing.

[KAM465]

Based on your response to the questions others have asked, it appears you can not afford the house and mortgage. To me it sounds like your would be better off not paying your mortgage and save up for moving into something more affordable. Having to rely on roommates and/or renters to make the mortgage payment in my opinion is a recipe for disaster down the road.