Going energy efficient with non-exempt cash before filing

[lovebirds]

Hey all!

Do any of ya'll have experience with high efficiency air conditioners? I am getting approximately $6000 for my tax refund that I'll have to spend down before filing Chapter 7(Interest free loan to government I know! Adjusting withholding after filing). I plan on prepaying all bills, escrow, insurance, etc to lower my monthly bills after filing. Louisiana has no exemption for cash at filing.

What I'm really am interested in is buying a high-efficient central air unit...I live in Louisiana and they air is on 80% of the time. Do these central units really save money each month? The AC unit I have now is about 14 years old and our home inspector told us to start looking for a replacement when we purchased our home.

We can also replace our water heater but I prefer having a tank heater (at least for showers) since it keeps water warm even when the power it out for days (hurricanes and all).

Which would make a bigger dent in our monthly energy bill?

Our fridge is already 100% full so stocking up on food is not really an option. We don't eat prepackaged or canned stuff.

[DeadManCrawling]

The newer units use a new gas instead of Freon. It is called Puron under one brand, and other names.

Freon is being slowly phased out, and will become more and more scarce starting in about 2014 or so. Eventually it will no longer be made at all, and the only Freon available will be from salvaging old units. It will get incredibly expensive then.

These new units are more efficient, but that only takes you so far. If the house itself is not up to snuff, you will see less benefit from a new unit. I am going through this on our new house right now, too. I am working to get better seals around openings, insulation improvements and such.

The new units also are larger than the previous generation. This is because they need to be capable of handling more pressure. The one we had to buy would no longer fit in our attic space and had to be relocated to the garage.

I do not think a trustee would question this kind of purchase, but you do want to make sure you get a few bids. Our quotes, for the same EXACT unit ranged from a low bid of 8k to a high bid of 19k. Obviously, we went with the low bid.

We got a lifetime warranty with our unit from Amana. Now, some folks in the business, and outside it, will tell you Amana (or whatever brand they do not like) is not as good as, say, the expensive units. You get what you pay for, but only to a degree.

In our research, we checked ratings of the top 10 units. The top 5 had a rating range of 93-95% in Consumer Reports. However, the margin of error was +- 3%. So all 5 of the top 5 could be considered the number one pick.

In our case, we expect to live the rest of our lives in this home, so a lifetime warranty made sense. The warranty is in effect as long as you own the home. If something breaks, they replace it. If they are no longer making the same model, they will bring a whole brand new unit and install it at no cost.

Sometimes warranties have fine print that makes it worthless. I could not find that in this case, but we have yet to have any problems, so I could sure be mistaken. I guess we will know in 15 or so years, huh?

Good luck in your purchase.

[HHM]

Do you have an attorney?

You need to be careful with some of what you are planning. Prepaying certain expenses can be a no-no in bankruptcy. Also, buying new appliances can get you in to trouble too, it is one thing to repair or replace for a health and safety reason, it is another to upgrade when no real need exists.

[lovebirds]

Our lawyer said prepaying bills and buying a new AC unit would be no problem as long as we paid it with our refund and not finance it. The AC unit was inspected and our repairman said it would probably go out any day now.

Why would pre-paying be a no-no? I would have to prepay to some degree in any case since we are not allowed to have any money in the bank at filing.

[lovebirds]

The newer units use a new gas instead of Freon. It is called Puron under one brand, and other names.

Freon is being slowly phased out, and will become more and more scarce starting in about 2014 or so. Eventually it will no longer be made at all, and the only Freon available will be from salvaging old units. It will get incredibly expensive then.

These new units are more efficient, but that only takes you so far. If the house itself is not up to snuff, you will see less benefit from a new unit. I am going through this on our new house right now, too. I am working to get better seals around openings, insulation improvements and such.

The new units also are larger than the previous generation. This is because they need to be capable of handling more pressure. The one we had to buy would no longer fit in our attic space and had to be relocated to the garage.

I do not think a trustee would question this kind of purchase, but you do want to make sure you get a few bids. Our quotes, for the same EXACT unit ranged from a low bid of 8k to a high bid of 19k. Obviously, we went with the low bid.

We got a lifetime warranty with our unit from Amana. Now, some folks in the business, and outside it, will tell you Amana (or whatever brand they do not like) is not as good as, say, the expensive units. You get what you pay for, but only to a degree.

In our research, we checked ratings of the top 10 units. The top 5 had a rating range of 93-95% in Consumer Reports. However, the margin of error was +- 3%. So all 5 of the top 5 could be considered the number one pick.

In our case, we expect to live the rest of our lives in this home, so a lifetime warranty made sense. The warranty is in effect as long as you own the home. If something breaks, they replace it. If they are no longer making the same model, they will bring a whole brand new unit and install it at no cost.

Sometimes warranties have fine print that makes it worthless. I could not find that in this case, but we have yet to have any problems, so I could sure be mistaken. I guess we will know in 15 or so years, huh?

Good luck in your purchase.

Whoa! That is one expensive AC unit.

My father actually recycles Freon when he repairs auto air conditioning systems and makes a killing reselling it.

[frogger]

The AC unit was inspected and our repairman said it would probably go out any day now.

Any ac man that told me that and expected me to believe it would be called my "former" ac man from now on. Just because it's old doesn't mean its going to quit tomorrow.

Many of the older units will still last longer than the new ones of today.

[lovebirds]

Any ac man that told me that and expected me to believe it would be called my "former" ac man from now on. Just because it's old doesn't mean its going to quit tomorrow.

Many of the older units will still last longer than the new ones of today.

It was our home inspector when we purchased the home. Not "AC man".

I mean, I could go and buy $6000 of work clothes but I'm one of the few women who hate owning lots of things. I'd rather use my money on something to reduce our monthly costs in the long-term.

We have high efficiency windows and appliances but our electric costs during the spring and summer are nearing $500 for a 1800 sq ft home. Last month, when we finally got cool weather, our electricity was only $120.

[frogger]

You may find that cleaning the coils (inside & out) would do wonders for your power bills.

Depending on what seer it is, you may or may not have electric savings.

If you do change, the 13 seer is still the best overall buy for the money. You can get the 16 seer and higher, but they do not seem to work as efficiently as they claim.

And also - don't forget that in summer, most all of the power companies raise their rates. What may seem high (that you're blaming on the ac unit), may be a byproduct of the rates imposed by the power company.

[jdcat]

About paying the monthly bills in advance...like auto insurance for example....wouldn't doing so affect DMI? It doesn't seem right that a debtor could claim a monthly expense for auto insurance if there won't be a monthly expense for auto insurance.

I've had thoughts of doing the same thing with my refund but decided not to because of this.

[lovebirds]

I'm already negative without including car insurance so I'm guessing it would affect my DMI too much. Escrow would of course be a different story. My mortgage is re-adjusting to $500 more than usual starting in in February due to taxes shooting up which I can't appeal until August. I want to just keep the same mortgage payment that I started with.

[lovebirds]

You may find that cleaning the coils (inside & out) would do wonders for your power bills.

Depending on what seer it is, you may or may not have electric savings.

If you do change, the 13 seer is still the best overall buy for the money. You can get the 16 seer and higher, but they do not seem to work as efficiently as they claim.

And also - don't forget that in summer, most all of the power companies raise their rates. What may seem high (that you're blaming on the ac unit), may be a byproduct of the rates imposed by the power company.

Coils? My AC unit has coils?

[HakunaMatata]

About paying the monthly bills in advance...like auto insurance for example....wouldn't doing so affect DMI? It doesn't seem right that a debtor could claim a monthly expense for auto insurance if there won't be a monthly expense for auto insurance.

I've had thoughts of doing the same thing with my refund but decided not to because of this.

This cost exists whether it's paid annually or monthly. If the cost is paid in a lump sum, the monthly average is considered an expense.

[frogger]

Coils? My AC unit has coils?

The outside condensing unit has them, just as the inside evaporation unit does. Outside - it's the finned radiator looking thing that goes around your unit. Inside, it's the same thing, just made differently.

Pull your air filter out and stick your head up in the space where the filter was at and you can probably see them. If they're covered with black goop, then need to be cleaned.

The outside unit needs to be cleaned every year, even if it doesn't look dirty. It is......

[OhioFiler]

We get to use our A/C unit like twice a year here in northern Ohio. I don't feel sorry for any of you who are stuck running your units all year long.

[jdcat]

Thanks for answering lovebirds and Hakuna. That makes total sense and I can't believe I didn't see it! *smacks palm on forehead* I can be a little dense sometimes, LOL!