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    Gifting a vehicle

    If I give a car thats in my name to my father as a gift, would it still be considered bankruptcy fraud if it was over 6 months ago? if so, how long should i wait to file? would they try to take it from my father?

    #2
    Yes, it would be. It's called a "fraudulent conveyance" and that's just some fancy speak. Doesn't mean you're a criminal, just means that the Trustee can "undo" that transfer and get the property back. The Trustee can look back 1 year on such conveyances to "insiders" like family members. Yes, the Trustee can demand it back by suing your father... or demanding equivalent value. Some people have been known to just "settle" with the Trustee.

    While the Trustee would need to "prove" that you did so to move the property outside the reach of a creditor or creditors... the burden isn't that difficult. Generally, if you are not paying your bills and then give away property worth value to an insider, that's a fraudulent conveyance.

    Generally speaking, you need to give it at least one year before filing. The real question is... why are you giving it away? Do you owe money to your creditors? Why did you not sell it and use it to pay creditors? (These are questions the Trustee may ask. )
    Chapter 7 (No Asset/Non-Consumer) Filed (Pro Se) 7/08 (converted from Chapter 13 - 2/10)
    Status: (Auto) Discharged and Closed! 5/10
    Visit My BKForum Blog: justbroke's Blog

    Any advice provided is not legal advice, but simply the musings of a fellow bankrupt.

    Comment


      #3
      Originally posted by justbroke View Post
      Yes, it would be. It's called a "fraudulent conveyance" and that's just some fancy speak. Doesn't mean you're a criminal, just means that the Trustee can "undo" that transfer and get the property back. The Trustee can look back 1 year on such conveyances to "insiders" like family members. Yes, the Trustee can demand it back by suing your father... or demanding equivalent value. Some people have been known to just "settle" with the Trustee.

      While the Trustee would need to "prove" that you did so to move the property outside the reach of a creditor or creditors... the burden isn't that difficult. Generally, if you are not paying your bills and then give away property worth value to an insider, that's a fraudulent conveyance.

      Generally speaking, you need to give it at least one year before filing. The real question is... why are you giving it away? Do you owe money to your creditors? Why did you not sell it and use it to pay creditors? (These are questions the Trustee may ask. )
      thanks for your reply. it would be just to protect it. it is worth 18K. i do owe creditors. i would say it was a christmas gift because his car broke down on him with a costly repair and that my girlfriend drives me to work now. if i wait over 15-16 months, do u think i could get away with it?

      Comment


        #4
        Originally posted by eplatt31 View Post
        thanks for your reply. it would be just to protect it. it is worth 18K. i do owe creditors.
        This is precisely why the Trustee has significant avoidance powers.

        Originally posted by eplatt31 View Post
        i would say it was a christmas gift because his car broke down on him with a costly repair and that my girlfriend drives me to work now. if i wait over 15-16 months, do u think i could get away with it?
        Doesn't matter if it's a Christmas gift of not. You would be seen as taking something of value and giving it to someone else, to avoid having to "give" it to your creditors, which you admit to doing. There's not difference.

        Now, as for how long to "get away with it", I can't tell you that. If someone could prove that you did this intentionally to defraud creditors, the lookback can be 4 years or more (depending on your State laws). If it's just the constructive fraud (you didn't "intend" to do it, such as giving it as a gift without knowledge that you were "hindering" creditors), the lookback is 1 year I believe. This 1 year lookback is what the Trustees generally go by.

        Perhaps the vehicle is mostly covered by some exemption. Why are you wanting to do this... "hide, hinder, or delay" creditors? In these cases, i almost always say "just get it over with!" Why risk the repercussions of manipulating the system?
        Chapter 7 (No Asset/Non-Consumer) Filed (Pro Se) 7/08 (converted from Chapter 13 - 2/10)
        Status: (Auto) Discharged and Closed! 5/10
        Visit My BKForum Blog: justbroke's Blog

        Any advice provided is not legal advice, but simply the musings of a fellow bankrupt.

        Comment


          #5
          Originally posted by justbroke View Post
          This is precisely why the Trustee has significant avoidance powers.

          Doesn't matter if it's a Christmas gift of not. You would be seen as taking something of value and giving it to someone else, to avoid having to "give" it to your creditors, which you admit to doing. There's not difference.

          Now, as for how long to "get away with it", I can't tell you that. If someone could prove that you did this intentionally to defraud creditors, the lookback can be 4 years or more (depending on your State laws). If it's just the constructive fraud (you didn't "intend" to do it, such as giving it as a gift without knowledge that you were "hindering" creditors), the lookback is 1 year I believe. This 1 year lookback is what the Trustees generally go by.

          Perhaps the vehicle is mostly covered by some exemption. Why are you wanting to do this... "hide, hinder, or delay" creditors? In these cases, i almost always say "just get it over with!" Why risk the repercussions of manipulating the system?
          i REALLY want to keep this car and i am letting 2 properties foreclose (whole other story), staying mortgage free as long as possible. i've already lost $75K in interest only payments and i'm upside down about $125K. i just want to recover as much as possible. If a deficiency judgment is put against me, thats when i will file for bankruptcy, thus wanting to salvage my car...

          Comment


            #6
            Well, if you file for Bankruptcy, just be forewarned that the car is "potentially" going to be lost if the Trustee sees it as an "avoidable" conveyance.
            Chapter 7 (No Asset/Non-Consumer) Filed (Pro Se) 7/08 (converted from Chapter 13 - 2/10)
            Status: (Auto) Discharged and Closed! 5/10
            Visit My BKForum Blog: justbroke's Blog

            Any advice provided is not legal advice, but simply the musings of a fellow bankrupt.

            Comment


              #7
              Originally posted by eplatt31 View Post
              do u think i could get away with it?
              Risky thinking.........
              All information contained in this post is for informational and amusement purposes only.
              Bankruptcy is a process, not an event.......

              Comment


                #8
                Remember, the Trustee's staff have access to the records - especially car registrations, property records and corp filings. These are all online and readily available for anyone to check. The Trustee's office has seen it all. Don't count on them not seeing the transfer. When you supply your records to the Trustees office (or your attorney to supply to the trustees office) that is just the start of their process, not the end. As JB points out, it would be considered a fraudulent conveyance if you have transferred the vehicle to an insider to protect it. So make sure to show it on your petition as the penalties can be severe.

                BTW, when you get to the point where getting rid of the debt and the problems outweighs wanting to keep any asset - then you are ready to file BK!
                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


                  #9
                  Originally posted by StartingOver08 View Post
                  Remember, the Trustee's staff have access to the records - especially car registrations, property records and corp filings. These are all online and readily available for anyone to check. The Trustee's office has seen it all. Don't count on them not seeing the transfer. When you supply your records to the Trustees office (or your attorney to supply to the trustees office) that is just the start of their process, not the end. As JB points out, it would be considered a fraudulent conveyance if you have transferred the vehicle to an insider to protect it. So make sure to show it on your petition as the penalties can be severe.

                  BTW, when you get to the point where getting rid of the debt and the problems outweighs wanting to keep any asset - then you are ready to file BK!
                  understood, but this car is my pride and joy. its amerceded cl55 amg in showroom condition. what if i say that it is broken down and i actually sell it "for parts" at $2K to a non-relative? will it be protected then?

                  Comment


                    #10
                    Originally posted by eplatt31 View Post
                    understood, but this car is my pride and joy. its amerceded cl55 amg in showroom condition. what if i say that it is broken down and i actually sell it "for parts" at $2K to a non-relative? will it be protected then?

                    Filing BK is a business decision. To jeopardize your entire BK over a vehicle is not a logical or ethical or wise thing to do. There can be significant penalties for fraud in BK. Concealment of assets is one of the most common forms of BK fraud. If your car is more important than getting your financial life back on track, then don't file BK.

                    Read this link http://docs.law.gwu.edu/facweb/gmagg...cy%20fraud.pdf

                    In particular, look at the bottom of pg 2 to see what the penalties are for BK fraud - they are severe.
                    Last edited by StartingOver08; 01-05-2010, 09:45 AM.
                    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


                      #11
                      Originally posted by eplatt31 View Post
                      understood, but this car is my pride and joy.
                      Perhaps you can continue your line of thinking and your pride and joy can meet up with you in jail?

                      There are many more things more worthy than sheet-metal for focusing your love and affection on.
                      All information contained in this post is for informational and amusement purposes only.
                      Bankruptcy is a process, not an event.......

                      Comment


                        #12
                        Originally posted by frogger View Post
                        Perhaps you can continue your line of thinking and your pride and joy can meet up with you in jail?

                        There are many more things more worthy than sheet-metal for focusing your love and affection on.
                        i agree and understand how superficial and risky my line of thinking sounds, but on the other hand - are there any people out there that have gotten around these limitations? EVERYONE has been caught that has attempted this? i didn't think so and thats why i came here to hear everyone's opinions..

                        Comment


                          #13
                          If the car means that much, file a chapter 13 and pay at least the amount of the non-exempt property in to the plan. Done deal, no fraud.

                          If you can't afford to do that, you can't afford to keep the car.
                          Filed CH13 - 06/2009
                          Confirmed - 01/2010

                          Comment


                            #14
                            Originally posted by eplatt31 View Post
                            i agree and understand how superficial and risky my line of thinking sounds, but on the other hand - are there any people out there that have gotten around these limitations? EVERYONE has been caught that has attempted this? i didn't think so and thats why i came here to hear everyone's opinions..
                            And all I gave you was mine. You'll do what you choose to do, you'll live with the results, and that's all right by me. The only person I have to worry about is the one I see in the mirror.

                            Good luck to you.
                            All information contained in this post is for informational and amusement purposes only.
                            Bankruptcy is a process, not an event.......

                            Comment


                              #15
                              Originally posted by eplatt31 View Post
                              understood, but this car is my pride and joy. its amerceded cl55 amg in showroom condition. what if i say that it is broken down and i actually sell it "for parts" at $2K to a non-relative? will it be protected then?
                              OK, I can't even finish this thread to the bottom. You are attempting to commit FRAUD plain and simple. We have seen this before and you "giving" your dad a car because his broke down is all a lie. I think this thread should be closed as in NO way this Forum should help in fraudulent posting as many others lurk reading this crap and think it is feasible to defeat the system. It is NOT! 'Hub
                              If I knew it all, would I be here?? Hang in there = Retained attorney 8-06, Filed 12-28-07, Discharge 8-13-08, Finally CLOSED 11-3-09, 3-31-10 AP Dismissed, Informed by incompetent lawyer of CLOSED status, October 14, 2010.

                              Comment

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