Car for kid question?

[bksmith12345]

Hi All,

My stepson's father wants to buy him a small used pickup truck. He is paying $9600 for it.

Her is the rub he wants to put it in my wifes name and we pay the insurance.

My stepson son is not 18 yet so it can't go in his name. We are in a 13 and the wifes ex nor our son know about it.

Can this have an impact on our plan? Could the trustee find out and what would happen if they did? Can the take the truck since it is in my wifes name even though we didn't buy it?

We need to know. Thanks for any input.

[CH33 Paralegal]

If your wife's name is on your bankruptcy, then you will have issues. You actually need to get permission to take on the car as an asset. There is no motion to incur debt, but you may have to have a hearing to put the asset in your name. But you all of a sudden will have another car, apparently worth 9600 that has no debt on it and there is no exemption that would cover it. It could be possible that now you have more money to pay into the case, unless you're already paying it out in full.

If your wife is NOT on the BK, then the car could be in her name...it's exclusively her wealth.....however, where is the money coming from to all of a sudden pay a new insurance bill? You're going to have to show on your budget that you can afford it and still afford the trustee payment. I have no idea what your budget looks like so you'd have to review that with your attorney to see if it would be feasible.

Either way, how about if the father can just play ball and keep it in his name....I would think he could have the kid insured on his policy just as the mom could do the same. And maybe the kid could pay the insurance. Speaking as a former 16 y/o who was NOT given a car, I would have to say that no kid is ENTITLED to a car, inside or outside of bankruptcy. If he gets the privilege of having a car, he should bear some of the responsibility.

[bksmith12345]

I figured as much. I told my wife this a month ago when the issue of the father buying the truck started.

I told her we have to fly under the radar of the trustee.

Sure might the trustee never know? I guess. But, I'm not taking that risk so the kid can get a truck.

My wife is calling the lawyer right now.

[CH33 Paralegal]

the courts actually possess the right to reverse a transaction like that as well, so if they do catch wind, they can fix it...plus that usually comes with a review to see if there is any abuse in the case going on.

I'm not sure why the father wants it out of his name, but keeping it in his name would negate a lot of potential issues.

[bksmith12345]

the courts actually possess the right to reverse a transaction like that as well, so if they do catch wind, they can fix it...plus that usually comes with a review to see if there is any abuse in the case going on.

I'm not sure why the father wants it out of his name, but keeping it in his name would negate a lot of potential issues.

When you say reverse do you mean? Do they make you take the truck back to the dealer get the money back and the trustee gets the money?

This whole thing really is maddining.

[getmeouttahere]

I feel your pain and frustration. I'm glad you have touched on this subject as I was going to start a thread similar to this.

I have a 16 (almost 17) son who want to purchase his own car with his own money. He has been saving and has almost $1500. From what I am reading, he cannot purchase a car and have the title in his name because he's NOT 18. I did not know this. Is this true for all states? We are newly confirmed in a Ch. 13, so I am assuming we cannot put the car in our name to help him with insurance costs, etc. Am I understanding this correctly?

bksmith, you mentioned your wife was calling your attorney? Have you gotten a response?

[bksmith12345]

I feel your pain and frustration. I'm glad you have touched on this subject as I was going to start a thread similar to this.

I have a 16 (almost 17) son who want to purchase his own car with his own money. He has been saving and has almost $1500. From what I am reading, he cannot purchase a car and have the title in his name because he's NOT 18. I did not know this. Is this true for all states? We are newly confirmed in a Ch. 13, so I am assuming we cannot put the car in our name to help him with insurance costs, etc. Am I understanding this correctly?

bksmith, you mentioned your wife was calling your attorney? Have you gotten a response?

I'm in the car business. 18 is the standard in all states I know of. No word yet from the attorney. This whole thing is nuts. I will not jepardize our plan to get him a car. As CH33 said if this raises the trustees ears then she will be on us and our plan like crazy. Flying under the radar is the only way.

I'll post here when we hear.

[CH33 Paralegal]

no, it's just that it goes back to the party that transferred it to you. In that instance, the car would just go back into the dad's name and that's that. The attempt at abuse that the court would interpret is that you filed with one set of wealth and then proceeded to live with a different set of wealth after the case was filed.

But yeah, lets say you sold a car to someone while in your BK and then spent the money you got for the sale without permission. The judge could order that the car goes back into your name and that you need to pay the money for the sale back to the buyer. If the money was gone, you'd still owe it and would be required to pay it directly. The abuse in that instance was that you used an asset you claimed to own to pay money to an obligation of your choosing, rather than putting it towards the BK. Preferential payments to creditors is a no no in BK.

[bksmith12345]

UPDATE-Heard from Attorney

Hi All,

Just heard from the attorney on this matter.

He said it is OK. That we can proceed with the purchase of the truck and having it in my wifes name.

So far he has not been wrong. I thought for sure he would have issues with it.

Could it be the case that our trustee dosn't really care as long as we pay them and everyone else on time?