Dreaded insider payments questions?

[Mark80]

I have been told on here many times that you cannot pay a family member or other "insider" debt during you file period. It makes sense, but what about your wifes debts? My wife has a few credit cards in her name, and the payments are made out of our joint checking account. She does not work and is a stay at home mom. I have to pay on her accounts or those will go into default and even more problems will mount. In any event I told my Attorney that I was going to catch up the bills I was behind on and pay off my wifes cards. That way when I do file we are in the best position we can be in. He said this was a great idea!

But yet everyone on here says this is a big "no" and everyone who I paid anything to after I stopped paying my unsecureds will be sued?

I also was told I would only have to supply 30 days of bank statements when I file?

Who is right? I have taken chunks of cash here and there to buy stuff for my upcoming newborn. Obviously this can be a red flag but we had to have it, and it was before I was warned.

Just kind of curious whats going to happen when I file next month?

[Flamingo]

If I read your posting correctly, you have taken out cash advances recently to pay off your wife's credit cards and also purchase items for your forthcoming child? Usually the look back period is six months - for bank and credit card statements. It was one year for us and can be one year for anyone - it's up to the Trustee. Did you tell your attorney about the cash advances, when they were and what they were used for? Unfortunately, I see red flags here for you under the circumstances you mention in your posting.

[Mark80]

No no, no cash advances on anything. I have not used any of my credit cards for over 6 months now. I'm talking about the money I make each week, I have been using my paychecks to get the things I need for my baby. And pay on my wifes cards. Trying to get 100% caught up and in good position before I file.

Sorry if I worded it wrong!

[Flamingo]

No no, no cash advances on anything. I have not used any of my credit cards for over 6 months now. I'm talking about the money I make each week, I have been using my paychecks to get the things I need for my baby. And pay on my wifes cards. Trying to get 100% caught up and in good position before I file.

Sorry if I worded it wrong!

It's OK...could be the way I read it to! :-) If you mentioned what you plan to do (or are doing) with your cash prior to filing with your attorney as you stated you did, and he/she advised you it was OK, there should be no issue. Just be prepared to provide six months of bank statements and if you are paying your wife's credit cards directly out of your account, that will be showing on your bank statements. Ensure you go over that with your attorney in case an issue should arise. As long as you are open and honest with your attorney and your attorney is aware of what is going on.

[magyar123]

As to the issue in the first paragraph: Since you are including ONLY YOUR own debts in yout filing the question about preferential/insider payments should not come up when you pay on your wife's credit cards. They are not your debts.

[Frogge]

The payments to your wife's credit cards should not be considered "insider" payments.. these are household debts, but interesting because I assume you are filing alone, without your wife?

[Mark80]

Correct I am the only one filing. Reason being my wife only has 2 credit cards, one with around a 200.00 balance, and the other around a 1200. I didn't want her file marked as BK when thats all she has. Plus its nothing compared to my 37k and I am sure even during a 13 plan we can manage the small payment amount. PLUS I hope to have both paid down over the next month or so, just trying to buy as much time as possible before I get sued!

[woeisme]

I was originally going to file alone since I had the majority of the debt, while my husband's was smaller. My lawyer was going to count the payments on his debts against our disposable income, so I assume this is allowed, at least by some trustees. We ended up deciding to file jointly later due to some concerns about accounts that were in my name but he was an authorized user on, decided if we had to do all the budgeting required for a CH 13 might as well eliminate all the debt and prevent anyone from trying to come back to him later for debts that should have been just in my name, but it was my understanding that payment on spouse's debt if one was filing alone was allowable.