Question reagarding vehicle sale and credit cards

[mesa777]

I have a question in regards to a recent car sale, I owned two cars, one with a balance of $14K and the other at around $5K.. At this point I am current on all bills and may file bk in the upcoming months, question is this... The attorney who I have speaking with advised ok to live on the extra funds and such until I file, if I file, I was advised that I can put up to $5K into an exempt IRA account within 120 days prior to filing, does this sound right???? Just don't want to be thrown in jail!

Also I am on the verge to start missing credit card payments, am very worried about this and don't know if I should even continue to make payments, one cards min payment is $700 a month, made a $22K cash advance in 8/07 and have made payments since, I am just sick that I am in this mess however know I am not alone here, bad choices are my fault however hope to do something here soon... If I don't make a payment on the large bal from B of A how long before I get sued, wage garnishment??? Help. ):

[lrprn]

The attorney who I have speaking with advised ok to live on the extra funds and such until I file, if I file, I was advised that I can put up to $5K into an exempt IRA account within 120 days prior to filing, does this sound right???? Just don't want to be thrown in jail!

If you really want to confirm this, speak to several other bk lawyers in your area before you retain one. This is one of those areas that can vary between what the trustees in your local court and your specific creditors will accept when you file.

Also I am on the verge to start missing credit card payments, am very worried about this and don't know if I should even continue to make payments, ...

If you are certain you are going to file within the next 4-6 months, then continuing to pay your credit cards is a waste of your hard-earned money. Discuss this with your lawyer first before stopping payment.

If I don't make a payment on the large bal from B of A how long before I get sued, wage garnishment??? Help. ):

Typically you'll have at least 4-6 months of non-payment before most creditors start getting serious about heading to court or selling your debt to a collection agency and writing off the loss. Some of our members haven't paid on their cc's for more than a year and haven't filed yet - still no court dates. Just depends on the creditor and how much they are willing to invest up front to get their money from you eventually.

[liz417]

Hi there,
I can't help you on the car/IRA question, but I'm sure someone will be able to answer that shortly.
As for the BofA cash advance, it's been a year and you've made payments, I don't see any problem there. Don't worry about being sued or wage garnishments, from what I've read, it's expensive for the cc's and they have to get a judgemnet you'll have notice if/when they do decide to sue.
Good Luck!

[mesa777]

Thanks for the advice..... anyone else here put money into an IRA before filing? I was told that its legal up to the yearly limit... anyone else here do this??

[Bandit]

Thanks for the advice..... anyone else here put money into an IRA before filing? I was told that its legal up to the yearly limit... anyone else here do this??

I would not make any big moves like that with thousands of dollars until after you ask some more attorneys in your area. You could really screw things up & make it worse if you dont at least ask how it is viewed & what is allowed where you live.

They will be seeing/looking for thousands of dollars no matter what you do with it, if that is what you are thinking so double check the law in your state for all your exemptions & assets before you make moves. Just because one place says it is ok for that amount does not mean every state is the same.

So how are doing, mesa777?
It sounds like things are looking a little better for you than they were a few months ago. Yes?

[Help!]

I think it might raise eyebrows if the IRA is opened right about the time you stop making payments on the CC's. IRA's are generally exempt, but there is a chance this could be added back in as income on the means test the way 401K contributions have. Trustees seem to recognize when money has been diverted in order to try to protect it from being part of the BK estate. I'd rather give the trustee $5K and get the discharge.

[BKParalegal]

Not a chance, it is exempt as exempt can be. You can sock as much as the legal limit allows into an IRA, Roth IRA, 401k, 403, whatever. Continuing 401k contribution not being allowed on the Means Test has nothing to do with putting funds into one prior to filing.


Good Luck

[Bandit]

Not a chance, it is exempt as exempt can be. You can sock as much as the legal limit allows into an IRA, Roth IRA, 401k, 403, whatever. Continuing 401k contribution not being allowed on the Means Test has nothing to do with putting funds into one prior to filing.


Good Luck

Do you just mean in Nevada?

it wasn't exempt when my mother filed in 2005. in fact the attorney told her to remove the money & they did something else with it, though it was not that much Alabama could have taken it.

What is your opinion of this site? & rollover IRA accounts?

http://www.assetprotectionbook.com/bankruptcyconfusion.htm

Check out the Alabama section.

Alabama IRAs & Pension Plans
Whether an IRA qualifies as exempt depends on whether or not it meets the definition of a "qualified trust" in Alabama. [19-3-1]

& what do you think about the IRA that appears prior to filing? Just wondering.

[mesa777]

Good article in regards to IRA's, have already sold the vehicle and am waiting for the check, I am only behind on one acct at this time however only by 20 days, B of A card, I am using the funds to cover bills and what not until I decide to file bk... I am planning on opening a IRA with my bank for around $5K allowable by law in my state, if the court wants to fight me for it than so be it. I was told by my attorney that as long as you wait I think 120 days after opening the IRA that you are safe, we will see what happens, first thing I am going to do is pay my attorney for the case and then go from there...

[Flamingo]

Good article in regards to IRA's, have already sold the vehicle and am waiting for the check, I am only behind on one acct at this time however only by 20 days, B of A card, I am using the funds to cover bills and what not until I decide to file bk... I am planning on opening a IRA with my bank for around $5K allowable by law in my state, if the court wants to fight me for it than so be it. I was told by my attorney that as long as you wait I think 120 days after opening the IRA that you are safe, we will see what happens, first thing I am going to do is pay my attorney for the case and then go from there...

Mesa - don't play games with your funds; if your attorney told you it is OK then it is OK for you. You will get all sorts of varying opinions as to what to do on this forum and any other BK forum on the internet but always get the correct legal advice for your particular sitiuation to protect yourself.