Adversary Threat Question

[Mensa1]

I told my lawyer about the BT at our initial meeting and he said that it was not a problem. We did not buy anything, I just did it online and at the time I had not even considered BK.

Another classic case of an Atty who didn't think this thru very well, IMO. How in the world can the Atty make that statement? At the very least he should have encouraged you to wait until the BT was seasoned, and even then you might still have a challenge. With the time frame since the transfer
you are merely making it easy on Chase to file the AP. Can't blame them for that move, anyone would do the same.

I am familiar with the thought that BT is not new debt. Lets hope your Atty is well read on such case law. Wish you a reasonable resolution.

[Dst1]

You are technically and presumed to be insolvent 90 days within filing.

That's news to me. Would you care to tell me why you think that.

(Chase is after you because a balance transfer is the same as a "cash advance" and those are presumed to be non-dischargeable. I'm sure the Chase letter mentioned 11 USC 523.)

But as you point out, this is a rebuttable presumption. I would hope his attorney would know the attitude in his district and know whether this would fly or not given his specific factual circumstances. Based upon the information provided here, it seems like he as an easy case to rebut the presumption.

[gello]

And to add, I had every intention of paying the debt. My wife and I are both employed, but we just got overwhelmed. We have never missed a payment, never been late, etc...So not sure how they can say we are insolvent.

[gello]

Well, you may be in a bad position. You are technically and presumed to be insolvent 90 days within filing. You would have to prove otherwise. The bank, Chase, has a pretty good case. Strange though, some Trustees have gone after it as a preference since you paid off another creditor over $600. So, the Trustee may go after Chase on his/her own accord. Should get interesting if that happens, and Chase is probably hedging the bet to not be standing there looking stupid when the music stops.

(Chase is after you because a balance transfer is the same as a "cash advance" and those are presumed to be non-dischargeable. I'm sure the Chase letter mentioned 11 USC 523.)

There is some caselaw, especially in the 6th Circuit, that indicates that a balance transfer is "not" new debt. Therefore the debtor should be able to beat a non-dischargeability complaint. However, those cases are fact specific. If Chase sent you a balance transfer check and said "hey look... 0% if you do this now", and you did so to save money, that could help you win the adversary proceeding (AP) / complaint. If you just said... "hey self, why not move Card X to Card Y" and the only reason was to free up credit... this could be an "eve of bankruptcy" issue.

You and your attorney need to sit down and think about this. The majority of the caselaw is that this would be a non-dischargeable debt unless you have "special" circumstances like the one listed above.

I didn't do it to free up credit, I did to try and stay out of bankruptcy. Which obviously did not work. Anyway, I am pretty POd that my lawyer did not say anything when I mentioned this. Chase's lawyer offered me terms for the amount owed, but it is the full amount, which is obviously I cannot pay.

[justbroke]

Well, you may be in a bad position. You are technically and presumed to be insolvent 90 days within filing. You would have to prove otherwise. The bank, Chase, has a pretty good case. Strange though, some Trustees have gone after it as a preference since you paid off another creditor over $600. So, the Trustee may go after Chase on his/her own accord. Should get interesting if that happens, and Chase is probably hedging the bet to not be standing there looking stupid when the music stops.

(Chase is after you because a balance transfer is the same as a "cash advance" and those are presumed to be non-dischargeable. I'm sure the Chase letter mentioned 11 USC 523.)

There is some caselaw, especially in the 6th Circuit, that indicates that a balance transfer is "not" new debt. Therefore the debtor should be able to beat a non-dischargeability complaint. However, those cases are fact specific. If Chase sent you a balance transfer check and said "hey look... 0% if you do this now", and you did so to save money, that could help you win the adversary proceeding (AP) / complaint. If you just said... "hey self, why not move Card X to Card Y" and the only reason was to free up credit... this could be an "eve of bankruptcy" issue.

You and your attorney need to sit down and think about this. The majority of the caselaw is that this would be a non-dischargeable debt unless you have "special" circumstances like the one listed above.

[gello]

Hello all, I am new to this forum and have recently filed Chapter 7. Here is my situation. I did all that I could to pay my bills. And in January, I transferred some balances to a card with lower rates. After that, I decided that we could not pay our bills and survive. I met with a lawyer and it was determined that the best course of action was to file Ch.7. Well, we just had our 341 meeting and I recently got a letter from Chase regarding the balance transfer. I told my lawyer about the BT at our initial meeting and he said that it was not a problem. We did not buy anything, I just did it online and at the time I had not even considered BK. Now, I get this threat from Chase for an adversary proceeding offering me repayment terms. It states "it appears that this is a classic case of your client running up a CC prior to filing for BK." While I did make the transfer, I did not increase my debt. My lawyer never said anything about the 70 days. So, basically, am I screwed? Thanks in advance for any advice.