Help! What should I do?

[imacountrygurl]

I filed ch 13 in mid november. I received a $2500 check from my ex for attorney's fees in early november. I haven't yet cashed the check. (Divorce was final in July...ex just now paid. Atty fees were actually meant for my dad who withdrew money from his retirement to pay my divorce atty) My bk atty suggested that since the judgment in the final decree states that the atty fees are to be paid to "name of atty" that I should just endorse the check "pay to the order of" and give them to the atty, who could then cut a check to my parents. Problem is that my divorce atty won't do this...doesn't want to get in the middle of it. Also asked the ex if he would make the check directly out to my dad, instead of to me...no way. Could I endorse the check 'pay to the order of " my dad, and give it to him? That way I never have possession of the actual $$. My creditor's meeting is scheduled for Jan 5 and this money is not mentioned in the bk papers. Could I cash it at a check-cashing place instead of putting it into my bank, could they find out about it then? I don't know what to do. I would hate for this money to go to the trustee after my dad pulled it out of his retirement...and then me not be able to even make payments to him for 5 more years!

[StaciMM]

This is sticky... The BK petition asks for 'accounts payable' or monies that are owed to you, but technically this really wasn't owed to YOU since the divorce paperwork says payable to your divorce attorney. On the other hand, your dad paid the attorney with the understanding you would pay him back once you got the money from your Ex, making your dad one of your creditors.

Normally I'd say go w/ what your attorney says, but it seems that isn't an option since your Ex and the divorce attorney aren't willing.

How much are you scheduled to pay into your plan, and what % goes to unsecured creditors?

[imacountrygurl]

I am paying $1062.92 for 60 months. As far as I can tell nothing is going to unsecured creditors. They are paying a total of $11,500 arrears on my mortgage in addition to my monthly mortgage payment. Then attorney's fees of $1750, and the trustee's share. I am surrendering my truck. I have almost $11,000 in credit card debt. On my summary, it shows $207,530 in assets, and $122,720 in liabilities; monthly income as $2817.92 and monthly expenditures of $1,755.

[StaciMM]

Its a tough call you have to make. You can try not disclosing it to the trustee. If the trustee finds out, he'll make your dad pay it back. On the other hand, there is a slight chance that being honest with him will be ok. You can show the divorce decree, and can probably show documentation that your dad paid the attorney fee.

[imacountrygurl]

my attorney said the trustee will definitely take it...that payments to family are "preferential" no matter what documentation I have. There is no expiration date on the cashier's check...so far I've just been holding onto it...and waiting for further advice from my attorney (who of course is out of the area for the holiday season). My mom thinks I should be able to just sign it over to them just as I would have signed it over to the attorney...I'm not sure though so I'm holding off on doing anything. Thanks for your help though.
On another note, is it unusual for there to be nothing going toward unsecured creditors in a ch 13? This kinda has me worried...I'm the first filing for my atty under the new law. I think I meet the means test to file ch 7, but I really wanted to save my house...last stable thing for my 4 kids after a 3 year battle in divorce court...

[StaciMM]

That would depend on the state. Some might have a minimum % to unsecured, I don't know for sure which ones do. If you have no non-exempt assets, the minimum to unsecured would be $0 unless your state required they get some %.

(If you have non exempt assets, your unsecured creditors would need to get at least the amount equal to your non exempt assets.)

[StaciMM]

This is a long shot-but if its a cashier's check, perhaps you could go to the bank that issued it and ask them to replace it w/ a cashier's check to your dad?

[StaciMM]

One last thought-what state did you file in & how much equity is there in your home & how much do you owe on your home? Have you checked to see if there is an exemption to cover it? (I asked about the equity because some states allow you to use a portion of a homestead exemption as a wild card if you don't need the full exemption.)