i have heard that the normal time the trustee looks back for asset sales or transfers is one year. my roommate is considering filing bk, and we sold a house a little over a year ago, and then a previous house 4 years ago. we dont have to file taxes, as all income is tax exempt, so nothing to find there, i was wondering if any of you that have filed bk, have had trustee look back farther than one year? if so i dont see the relevance if you arent filing until almost 2 years later.
-
-
They can do up to a 4 year look back if they suspect it is warranted, and that suspicion has really a low bar, it could just be that they feel you aren't being truthful with them, even if you are.May 31st, 2007: Petition Filed by my lawyer
July 2nd, 2007: 341 Meeting Held
September 4th, 2007: Discharged and Closed. -
i assume you mean they would look for fraud for 4 years, not legal transactions, she cleared 40k on a house 4 years ago, she paid credit cards faithfully for those four years, so what she did with that money should be irrelevant now, also the other house shouldnt be a issue, even though only 2 years passed, if she wasnt anticipating bk then what she did with the money shouldnt matter, right? there were no balance transfers or preferential payments, a lot was spent at the dog tracks.Comment
-
They are looking for fraud but in order to do so they review your regular statements (bank and cc's, mtg's and closing statements). They do not comment on your spending patterns or habits UNLESS it is a preferencial payment or insider payment or something to attract their interest. It sounds like she has nothing to worry about.Filed CH 7 9/30/2008
Discharged Jan 5, 2009! Closed Jan 18, 2009
I am not an attorney. None of my advice is legal advice in any way..Comment
-
The way that is written sounds like you had a low income. If you were charging when that is the case that is going to throw up a big red flag if any of the debt is credit card debt.Originally posted by junker View Post
"so what she did with that money should be irrelevant now"
The answer to the question is maybe. You need to understand the difference between an objection and fraud. Typically, a creditor is not going to object if the the debt is more than a year old. But if the trustee suspects fraud, he can look back four years. If that were to happen, the use of the money might become very relevant indeed. Why? Because one of the things the courts looks at is what the money is spent on. Gambling is considered a luxury item.So the poor debtor, seeing naught around him
Yet feels the narrow limits that impound him
Grieves at his debt and studies to evade it
And finds at last he might as well have paid it.Comment
-
Unless those houses were sold to an insider {family member,etc.} they timeframe is no issue.
Also, at the end of the day, gambling charges on a cc is just unsecured debt. Many people file for bk with income from ss or pensions. It's no red flag.Comment
-
no, the houses werent sold to family or insider, what i meant when i said it should be irrelevant, was 4 years ago when she got money for first house, she had no intention of filing bk, so what she did with that money should have no bearing on a bk today. even the house 2 years ago. she had no intention of filing bk until the last couple of months. the cards are current but tapped, although 7 years ago she had a couple of providian cards she tapped and didnt pay. they never came after her though, i am pretty sure though that her current cards, chase and capital will. i dont understand what you were saying about low income and charging on cc? being a problem? she has a va pension and ss.Comment
-
You can sell whatever you want to whomever you want, even an insider, as long as you get full market value. The red flag is when you sell an asset to hide it, for example, you sell and transfer title of your 100,000 house to your brother for 1.00.
The look back for any fraudulent transfer is two years but the trustee can really look back as far as he wants to if he suspects fraud.Comment
-
No.
This is true but misleading. Gambling debt is unsecured debt but by definition it is considered a luxury item. There are situations where that can make a difference.Originally posted by keepmine View PostSo the poor debtor, seeing naught around him
Yet feels the narrow limits that impound him
Grieves at his debt and studies to evade it
And finds at last he might as well have paid it.Comment
-
I know what you are thinking but that is not necessarily how the court will look at it. If the Trustee suspects fraud, the legal standard is preponderance of the evidence. The court will not simply take her at her word. It will look at a variety of factors to determine whether or not fraud took place, her stated intention being only one of many factors.Originally posted by junker View Post
However, I agree with others that based upon what you have told us here, I can't see a reason why the Trustee would suspect fraud. Can you?So the poor debtor, seeing naught around him
Yet feels the narrow limits that impound him
Grieves at his debt and studies to evade it
And finds at last he might as well have paid it.Comment
-
i guess i am missing the point, what you do with your money, any of it, 4 years ago, whether it be for gaming, buying expensive hookers, or whatever, shouldnt have a bearing on filing bk today, 4 years later. you mean the trustee could ask for a accounting of all your money from 4 years ago? and we have to have his approval on how it was spent? so if she gave the money to her children 4 years ago. and today for some reason needed to file bk, they could think that was fraudulant? the two shouldnt be related at all. but thankfully she didnt do any of that, she just spent it like most women do.
and do well.Comment
Comment