pay off a creditor before filing?

[sugar]

I was told that if I pay off a creditor, I must wait 90 days before filing, is that correct? I would like to pay off a small line of credit associated with my checking account so I can keep my checking account after I file. I also want to pay off my refrigerator which is on a no-interest payment plan. Are these things okay to do? TIA

[lrprn]

I was told that if I pay off a creditor, I must wait 90 days before filing, is that correct?

The bk law allows you to pay up to $600 total to a non-secured creditor during the 90 days before filing. If your small line of credit is less than $600, you can pay it off without worrying that the payment will be considered a preferential payment.

However, honestly, a checking account is a checking account no matter where it's based. Why not just open a new checking account at another financial institution, transfer all but $5 from the old account to the new account, and list the non-secured line of credit when you file?

Just curious.....is this small line of credit with a credit union?

I also want to pay off my refrigerator which is on a no-interest payment plan.

Anything you still owe on the refrigerator is secured by the refrigerator. How much do you owe on the fridge? How old is the fridge?

Again, honestly, whoever you owe this money to doesn't want a used refrigerator back - they want your money. Rather than allow this creditor to threaten, just list the debt on your filing and see if the creditor decides to pursue taking the fridge back. Chances are very good they won't, and you'll still have the fridge without having to pay off whatever you owe.

Please talk these situations over with your lawyer to ensure that what I've shared is true in your personal filing and local bk court.

[sugar]

The line of credit attached to my checking account is not with a credit union. The payoff amount is about $900. I have banked at this bank for over 25 years and I want to pay them.

I bought the fridge about a year ago. I owe $500.

I will call my attorney. Thanks!

[mrskal]

The line of credit attached to my checking account is not with a credit union. The payoff amount is about $900. I have banked at this bank for over 25 years and I want to pay them.

I bought the fridge about a year ago. I owe $500.

I will call my attorney. Thanks!

I dont see why you would pay that either. It is not like they are going to do you any favors for paying them because you have been with them for 25 years. I can only imagine that that $900 can be put to much better use on things you really need before you file for BK. Have you read through the forum at all? You will find all kinds of posts about what others have spent money on for needed things, maybe things you have not even thought about yet.

I would not pay the fridge either, they are not going to come and take it away. Again use that money toward other expenses. Good luck to you with whatever you decide.

[sugar]

Have you read through the forum at all? You will find all kinds of posts about what others have spent money on for needed things, maybe things you have not even thought about yet.

Yes, I have spent hours reading this forum. Maybe I am not reading the things that pertain to me. I have a brain tumor and do have some cognative difficulties. Perhaps I am just not understanding. I will keep trying and reading. Thank you!

[mrskal]

Sorry to hear that Sugar. That is one of the key things that I learned on here, I wish I would have found this site sooner. I cashed out a 401K to live off thinking we would figure a way out of our mess, had I known it would have been exempt I never would have. I would have stoped paying my creditors long before I did. Everyone here is going through the same things as us, it is nice to be able to get answers and advice during such a hard time. Hopefully some others will chime in on their experiences and acvice in your situation too.

[AngelinaCatHub]

Sorry to hear that Sugar. That is one of the key things that I learned on here, I wish I would have found this site sooner. I cashed out a 401K to live off thinking we would figure a way out of our mess, had I known it would have been exempt I never would have. I would have stoped paying my creditors long before I did. Everyone here is going through the same things as us, it is nice to be able to get answers and advice during such a hard time. Hopefully some others will chime in on their experiences and avice in your situation too.

I made these same mistakes. THAT is one reason I am here to stay for the "long haul" to save or stop others from blowing through the wealth they can protect. We also cashed in my 401k trying to stave off the inevitable. I, after 35 years of employment, have only a pittance of pension and SS. Hardly enough and a hell of a lot less than when we could afford to blow $50 at a restaurant. We cannot afford McDonalds at this point. But we have learned and after the fact, are living a better life. 'Hub