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We borrowed money from parents till our severance checks arrived

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    #1

    We borrowed money from parents till our severance checks arrived

    Both the hubby and I got laid off within 3 weeks of each other. My severance check took 7 weeks to get to me and the hubby's took 6 weeks.

    To pay the bills we borrowed from our parents and we told them we would pay them back upon getting our severance checks. We have paid them back but now I worry if in BK (we just declared) this will be an issue.

    We told our attorney and he asked how we paid them back and we said we paid them with cash because they just kept the $6k in their safety deposit box for a rainy day and they put it back...

    he just shrugged his shoulder and did not really say anything.

    now I'm worried that our parents will be in trouble

    any advice? thanks
    Chapter 7 filed 11/4/10 ---- 341 Meeting 12/1/10 ---- Discharge 1/31/2011.
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    #2
    They're not in trouble per se. But you have created a preference by paying them off within 1year of your bankruptcy filing. The trustee has the authority to sue them to make them pay this money back. Depending on how much money it is and how aggressive your trustee is, he may or may not go after them for that money.
    Pay no attention to anything I post. I graduated last in my class from a fly-by-night law school that no longer exists; I never studied or went to class; and I only post on internet forums when I'm too drunk to crawl away from the computer.

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      #3
      They're not in trouble per se. But you have created a preference by paying them off within 1year of your bankruptcy filing. The trustee has the authority to sue them to make them pay this money back. Depending on how much money it is and how aggressive your trustee is, he may or may not go after them for that money.

      Did you tell your lawyer about this transaction before you filed?
      Pay no attention to anything I post. I graduated last in my class from a fly-by-night law school that no longer exists; I never studied or went to class; and I only post on internet forums when I'm too drunk to crawl away from the computer.

      Comment

        #4
        Originally posted by MSbklawyer View Post
        They're not in trouble per se. But you have created a preference by paying them off within 1year of your bankruptcy filing. The trustee has the authority to sue them to make them pay this money back. Depending on how much money it is and how aggressive your trustee is, he may or may not go after them for that money.

        Did you tell your lawyer about this transaction before you filed?
        Yes, I did and he just shrugged his shoulder and said that its good we paid in cash. I just want to do the right thing and it seems like I pulled the trigger on filing too soon.

        thank you for your help

        Does anyone else have any advice on this issue? thanks
        Last edited by Fallonedward; 04-28-2010, 04:15 PM.
        Chapter 7 filed 11/4/10 ---- 341 Meeting 12/1/10 ---- Discharge 1/31/2011.

        Comment

          #5
          Originally posted by Fallonedward View Post
          Yes, I did and he just shrugged his shoulder and said that its good we paid in cash.
          I don't think that anyone here is going to give you any advice or guidance on what your attorney told you.........
          All information contained in this post is for informational and amusement purposes only.
          Bankruptcy is a process, not an event.......

          Comment

            #6
            Originally posted by frogger View Post
            I don't think that anyone here is going to give you any advice or guidance on what your attorney told you.........
            Thanks, appreciate the help
            Chapter 7 filed 11/4/10 ---- 341 Meeting 12/1/10 ---- Discharge 1/31/2011.

            Comment

              #7
              What chapter did you file? If a 13, and you're paying at least as much (as you paid your parents) to your unsecured, it may be a non-issue.
              Get mortgage modified: DONE! 7 months of back interest payments amortized, payment reduced over $200/mo
              (In the 'planning' stage, to file ch. 13 if/when we have to.)

              Comment

                #8
                Originally posted by SMinGA View Post
                What chapter did you file? If a 13, and you're paying at least as much (as you paid your parents) to your unsecured, it may be a non-issue.
                We filled all of the paperwork out on Monday and our lawyer was going to file today but my hubby has a 3rd interview tomorrow, so we asked her not to file for another month and she agreed. Our family suggested that we wait and see if he gets the job and then file after he has secured the job

                thank you for your help
                Chapter 7 filed 11/4/10 ---- 341 Meeting 12/1/10 ---- Discharge 1/31/2011.

                Comment

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