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    Savings and checking accounts

    We are looking at filing chapter 7 after Chase bank increased our payment by about 1500 a month and we just cannot pay it. We have an attorney meeting next week, but wondered about our checking and savings accounts.

    First, they are at a bank we have a credit card with so it makes sense to change banks of course so they cannot freeze our assets.

    But the savings account, which has appx 15000 in it, a gift on the death of my husband's grandmother, and is set aside to live on in the winter when my husband has little work and for an insurance deductible. Will they take that? Do we need to do things like prepay rent (have checked and we could do that for a year) and hide cash under our mattress so we don't have a savings account? How far back will they track the money? Will we need to hide extra money we make after we quit paying?

    Our situation is that we have stayed current, barely, until this came up but it has pushed us over the edge. My husband got laid off 7 years ago from a 6 figure job and we had to live on credit cards for a few months after we ran out of savings before he gave up on high tech and started working for an irrigation company. We have much less income, I have gone back to work and we have struggled HARD to make absolutely no progress in 7 years, just keep the wolf from the door, because we didn't want to take this path.

    This Chase thing is the catalyst. We just want to make sure we have our ducks in order before we file, which they say could happen as soon as the 16th of July.

    #2
    Originally posted by needachance View Post
    We are looking at filing chapter 7 after Chase bank increased our payment by about 1500 a month and we just cannot pay it. We have an attorney meeting next week, but wondered about our checking and savings accounts.

    First, they are at a bank we have a credit card with so it makes sense to change banks of course so they cannot freeze our assets.

    But the savings account, which has appx 15000 in it, a gift on the death of my husband's grandmother, and is set aside to live on in the winter when my husband has little work and for an insurance deductible. Will they take that? Do we need to do things like prepay rent (have checked and we could do that for a year) and hide cash under our mattress so we don't have a savings account? How far back will they track the money? Will we need to hide extra money we make after we quit paying?

    Our situation is that we have stayed current, barely, until this came up but it has pushed us over the edge. My husband got laid off 7 years ago from a 6 figure job and we had to live on credit cards for a few months after we ran out of savings before he gave up on high tech and started working for an irrigation company. We have much less income, I have gone back to work and we have struggled HARD to make absolutely no progress in 7 years, just keep the wolf from the door, because we didn't want to take this path.

    This Chase thing is the catalyst. We just want to make sure we have our ducks in order before we file, which they say could happen as soon as the 16th of July.
    Most of your questions involve what is known as bankruptcy fraud.
    Do not attempt to hide assests, period. Not by prepaying and not disclosing it (the prepayment would now be an asset), by withdrawing the money and hiding it, etc.

    The standard look back period is 6 months but the trustee can look back as far as they want if they want (like if something seems off).

    Depending on your state exemptions you may be able to keep some or all of the money. For example, I could use federal exemptions and was able to keep almost $15k in cash as I had little equity in my home. You can find out how much you will be able to keep and spend down the rest on living expenses (keep receipts in case you are questioned).

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      #3
      Make sure you are 100% honest with your attorney about the savings account. If there is a way to protect it he will legally. Bankruptcy fraud is no joke, you could go to jail if you fail to disclose all assets. The money is in the bank so there is a record of this and it is the trustees job to uncover these things. Don't think you can outsmart him.

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        #4
        Thanks. Will disclose everything to the attorney. I have a little extra in my checking account but just found out that my car needs an expensive repair so guess that won't be a problem. I will just keep the payment history. Old cars suck.

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          #5
          Just wondering, what if you use cash money if you are behind (say like 8 months) on the mortgage, is that still considered an asset if you are not actually pre-paying it?

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