Excess money questions..need answers?

[swiminindebt]

OK, all my paperwork is filled out and ready to got to my lawyer. I sold my bike yesterday before filing. I spoke with my attorney about this before selling it, and she suggested that I sell it or it would be taken. However, I have to keep up with what I spend until the court date, also knowing, that any unspent money will become trustee property to pay off creditors. I sold the bike for $9500. Kbb trade was 8k and retail was 11k, so I did better than I anticipated. I deposited the certified bank check into my account so that there would be no questions and have copies of all the papers from the sale. My main concern is, I know that I will probably spend at least 1500-2000 dollars of this money over the next couple of months, just on bills and normal expenses. When I deposited the check, I had $31.48 in my account and 11 days to payday. As long as I use the money on normal bills, gas, school lunches for my kids, etc. will this be OK? Just really worried about every step I take. I have over 70k in cc and unsecured debt and don't mind giving up the cash if it will get me a fresh start, but I know I will need to use some of it. As long as I keep all reciepts and bank statements, is this OK? Please help>>>>>>>>>>>>>>>>>

[herekitty]

You need the bare minimum in there - there's a good chance the trustee will see such a large sum and want it back.

[swiminindebt]

Yeah, I've got to be real careful. I can't afford for them to think fraud, in any way shape or form. I know my states laws say that I can have $1000 in cash on hand as exempt. That still will leave a nice "wad" of money for them to grab up though. If I knew what I could spend it on, I'm sure there are things but I don't know, I would use it. My lawyer said that if I tied the money up into exempt property like my home, it would be safe. How do I know what type things I can do though. We enclosed our garage in '03, needed more room for kids, and it would be nice to put a new central HVAC system in that was larger than my existing one to heat and cool this extra area. However, I don't know if spending 3 grand on a new system would be a good idea. Any advice or experiences with this type situation would greatly help...thx

[herekitty]

What about vehicle repairs? Someone also had a good idea about using their tax return to purchase gift cards that could be used later to buy groceries, etc. THat my be a better question for the moderators though

[swiminindebt]

The only vehicle I will keep is my old SUV. It has over 140k miles on it but runs good. It need brakes and a few small repairs, but I don't want to sink too much money into it and have it look like it's worth taking. Our vehicle exemtion here is only $1200, so I will be cutting it close on that one anyway. Kbb trade in in $1600. My wife's car we will give back. We are upside down on it and not worth struggling to keep it. I am filing alone because everything is in my name only. House, car, cc, personal loan all in my name. Her credit was "challenged" when we married so I have purchased all of it under my name and credit, with her help paying it of course. She has been out of work since December and we are 5 months pregnant now, and found out she has gestational diabetes to top it all off. This has increased my outgoing also for testing supplies, etc. not covered by insurance. I would like to use the money to buy us a second car for when we have to give the other one back, but my lawyer said it may look "fishy" like a gift or trying to hide money. I don't really think so, just trying to have another car for a family of 5, with one more on the way. I appreciate everyone's input. This site has definately helped my nerves, as they are shot for the most part...LOL!

[hhou812hh]

I think if you get tires, brakes and with that high milage you can probably rebuild the engine and or tranny. I had a similar situation a couple of months ago and was going to do that since my car had 110,000 miles on it and was giving me problems. I ended up trading it in and buying a new car. I am going into a ch13 and will need reliable set of wheels to make the plan work. You can probably pay the trustee any non-exempt equity since this may boost the kbb value by a few bucks. At least you will have a car that will last you longer.

You can probably replace your roof. It would make sense to repair a car or house item that you know may go in the next couple of years saving yourself some future aggravation.

I'm not sure about gift cards though. Normally they probably wouldn't be traceable, but so close to filing you may have to explain where this cash went and a cash equivalant gift card maybe an asset. HHM or Todd may know.

Good luck!

[Whittio]

It seems to me, if you sold one "mode of transportation" (the motorcycle) and replaced it with something of exemption value, it should be fine?? I really don't know.. just trying to think logically. But if you spent $1200 on a used car, it would be exempt, and then you can put some money into that exempt car??

Don't know if it's legal.. but just tossing it out there. Seems like it would be easier to explain replacing a mode of transportation, then it would be to explain $5000 in groceries for a month. ;)

[StaciMM]

Are there any expenses you can prepay, such as auto insurance for the year or any of your wife's medical expenses? **I don't know for sure, but I think that would be ok and you'd be using the money where you need it**

I would think home improvements would be a good use, such as the HVAC system you mentioned or any scheduled maintenance you'll need in the next couple of years as someone else mentioned.

[swiminindebt]

Yeah, I asked my lawyer about prepaying the deductible on the hospital stay, but she said if the trustee made a deal of it, he could request the money back from the hospital. She said it was never good to prepay for anything. I will probably have it all used up in gas money by the time my paperwork is filed...LOL

[StaciMM]

Hey-that isn't funny!!

We have 2 vehicles: a car and a V8 truck. I drive the truck to work, and it doesn't go anywhere else, because I drive less miles during the day than my husband. His part time job involves a lot of driving, usually about 500 miles a week. They reimburse him for gas, but its per mile so it makes more sense for him to use the vehicle that doesn't burn as much! He goes thru about 2 full tanks a week in the car, but it would be 3 (even though its a larger tank) in the truck...

I pay about $40 a week right now in gas, just to get to & from work. Then, about $20 a week for the car, for my husband to drive to & from his full time job, and family errands/excursions.

I was proud of him-it was his idea to swap vehicles early this year, and his first big step in accepting financial responsibility. (I know it hurt his ego to give up his truck.)

I will probably have it all used up in gas money by the time my paperwork is filed...LOL