Move the Trustee Along

[mystery]

Once you are Discharged, YOU ARE OUT OF BANKRUPTCY. You can do whatever you want financially. Strictly speaking, you can do whatever you want financially the day after you file for BK (with some caveats, but that is not important).

Here is why...When you file BK, you create a Bankruptcy Estate that is made up of all your assets and liabilities, or right to assets that exist, and here is the important part, AS OF THE DAY YOU FILE. The Bankruptcy Trustee is the person who is placed in control of this "Bankruptcy Estate". Anything you get AFTER you file BK is yours and not part of the BK estate and cannot be touched by the trustee (there are some exceptions, but they are few, i.e. proceeds from life insurance when someone dies etc).

For example...
File BK: 6/1/06
Discharged: 9/1/06
You get a significant pay raise on 9/15/06, there is nothing the Trustee can do about it. With few exceptions, the Trustee can ONLY go after assets that you had, or had the right to that existed on or before 6/1/06.
Now, let's assume that when you filed BK, you forgot to mention on your BK Petition that you had a CD worth $5000 that you have had for a few years, and the trustee finds out on 9/15/06, the trustee can go get that money even if your case is post discharge.

For 95% of cases, the Debtor will know whether there are any hicups or issues with their BK by the time of discharge...and nearly anything that happens between discharge and closing is unimportant to the debtor.

Before you ask about Tax Refunds, remember what they are, you EARN a tax refund during the TAX year (but you only get it the following year when you file your taxes...thus, you have earned the right to the tax refund, that right to the refund is part of the BK estate, (at least up to the date you file).

HHM, Thanks for your imput!! However, the trustee did an examination (see yesterday's tread I posted "Need Help in Micigan") after 6 months after my case was discharged. Remember, he was questioning a real estate transfer I made (Quit claim deed) to my wife, looking for equity in my home, etc.? If he does rule it a fradulant transfer, it won't get him anywhere because we owed more on the home than it was worth!! With this said, can I rest knowing my case has been discharged, and not closed while the trustee fumbles around with my real estate issue? I mean, what is the worst thing that could happen? He could revert the quit claim deed, auction the property, and find out that it's upside down in value?? You seem very diverse on this issues. Thanks for everything!!

[HHM]

Exactly

If the house is upside down, or you owe just about what the house is worth, I wouldn't lose any sleep. The trustee won't do anything with it because there is nothing for him to get.

I assume this is a second house, and not your primary residence, if so, the only hicup I see is whether the US trustee might think you fudged your expenses or make more than you claimed, but if the US Trustee hasn't shown up by now, I wouldn't worry about.

[mystery]

HHM, No this is(was) my primary residence. They did question my income/expenses, why I listed 1/2 the mortgage payments if I didn't own the home, why I transferred my interests to my wife,etc.? I said that I filled out the forms listing all expenses that I share with my wife, and If I didn't "Share" in the Mortgage expenses, I would be paying my wife rent! Certainly, I can't live for free!!! Also, the attorney for a creditor that I owed $150,000(Boats) to, is the one that kept questioning me more about by income and expenses than the trustee!! But, one last question, have you heard of creditors showing up 8 months after the 341 meeting, and 6 months after discharge? I mean, he and the trustee were at the examination in August!!! Thanks. !!!

[HHM]

Think back to your first 341, did the Trustee say he was going to "continue" your 341 meeting (PACER should also have a notation that your 341 was continued). If so, what you described is not uncommon. 341's get continued when the trustee needs more info from you, so I am guessing this is what happend. Although typically, they are not continued for 8 months.

Honestly, its sounds like you did (no offense) some dumb things that you probably did not need to do, i.e. quit claim deed your home to your wife right before filing, that ALWAYS raises red flags etc. Which is why your case is in Limbo...because when you do stuff like that, it makes the Trustee take a closer look at your case.

[mystery]

Think back to your first 341, did the Trustee say he was going to "continue" your 341 meeting (PACER should also have a notation that your 341 was continued). If so, what you described is not uncommon. 341's get continued when the trustee needs more info from you, so I am guessing this is what happend. Although typically, they are not continued for 8 months.

Honestly, its sounds like you did (no offense) some dumb things that you probably did not need to do, i.e. quit claim deed your home to your wife right before filing, that ALWAYS raises red flags etc. Which is why your case is in Limbo...because when you do stuff like that, it makes the Trustee take a closer look at your case.

HMM, Thanks. I quit claimed my interests in the house 14 months before I filed BK. My wife and I were having marital problems. She agreed to take the house and the debt and I was going to move out. But, we reconciled things. I understand the red flag thing. Yes, pacer did say "341 continued" but that ended in April. Then came the exam. Thanks for your imput.