Preparing to file Ch7 and questions before 341 meeting

[specialop99]

Hi all

First, I would like to thank the community for providing the wealth of information about bankruptcy.

I'm currently $45,000 in credit card debt and keep a checking account with about $500 in it to pay for groceries, utilities and legal advice. I am married with a child and have no income. The credit card debts are only under my name. Currently, living with my parents. I don't own a house, apartment or a car and recently came back to the States after being abroad for 3.5 years. My wife lives in another country with my son and they get support from family and friends. Her parents help pay for rent abroad, and I just got back to the states so I can file for CH7 in Florida. I get help every month from my parents , an average of $300 a month. My questions are the following:

1) Any way to protect my checkings account? Or should i withdraw everything and just have cash on hand?
2) I hired an attorney, but he told me that my case may not be able to get discharge because I live abroad. Is living abroad reduces the chance of a discharge in CH7 in Florida?
3) If i feel i need to change an attorney, what is the best way to get the retainer back? he charged me $1000 plus 300 in filing fees.
4) Do i really need to stay in the states for at least 6 months before filing CH7?
5) if the 341 meeting comes up, how should i best answer the creditors to improve my success at a discharge regarding living abroad? I want to say, i want to clear my debt first before I can bring my family back to the states.

any help is appreciated

azri

[despritfreya]

1) Any way to protect my checking account? Or should I withdraw everything and just have cash on hand?

If you file bk, since you have not been in any one state for 2 years, I believe you will be using federal (not state) exemptions. There is no federal exemption for a bank account or cash on hand however, there is a wildcard which, I believe, you can apply to the bank account so you should be fine.

2) I hired an attorney, but he told me that my case may not be able to get discharge because I live abroad. Is living abroad reduces the chance of a discharge in CH7 in Florida?

This is the requirement for "venue" which must be met to file:

"Debtor has been domiciled or has had a residence, principal place of business, or principal assets in this District for 180 days immediately preceding the date of this petition or for a longer part of such 180 days than in any other District"

This means you need to be in the state in which you want to file for at least 91 days before filing. I doubt that your history of living abroad matters if you return to the US and then reside in one state for 91 days.

3) If I feel I need to change an attorney, what is the best way to get the retainer back? he charged me $1000 plus 300 in filing fees.

Ask for your money back. The attny should honor your request but should calculate, based upon a standard hourly rate, how much he gets to keep based upon the time he has already invested in your case. Certainly the $ paid for the filing fee must be returned as those funds were given to him to hold in trust and earmarked for the court.

4) Do I really need to stay in the states for at least 6 months before filing CH7?

91 days is the requirement. See above.

5) if the 341 meeting comes up, how should I best answer the creditors to improve my success at a discharge regarding living abroad? I want to say, I want to clear my debt first before I can bring my family back to the states.

I don’t think this will come up as it probably has no relevancy regarding discharging debt.

Des.

[specialop99]

what will happen if I file before the 90 days are up? E.g. I filed first, then stayed for 90+ days. I also have a valid driver license in Florida.

[despritfreya]

what will happen if I file before the 90 days are up? E.g. I filed first, then stayed for 90+ days. I also have a valid driver license in Florida.

You simply can't do that. You sign your Petition under penalty of perjury. You are avowing that you have met the requirements for venue and if you knowingly have not, if caught, you can be criminally prosecuted. Certainly not worth the risk. Live in the State for the required time then file.

Des.

[specialop99]

thanks for your prompt response. Now, i was looking at my Voluntary Petition and it says:

"Debtor has been domiciled or has had a residence, principal place of business, or principal assets in this District for 180 days immediately preceding the date of this petition or for a longer part of such 180 days than in any other District."

One attorney told me that i had to stay 180 days in Florida before filing to be safe, other attorneys say 91 days in Florida. Why did others say 91 days? Where are they getting this information from?

Thanks in advance

[despritfreya]

One attorney told me that i had to stay 180 days in Florida before filing to be safe, other attorneys say 91 days in Florida. Why did others say 91 days? Where are they getting this information from?

The attny who is telling you 180 days is required probably does not know how to read or explain "or for a longer part of such 180 days than in any other District." As a result, he/she takes the safe approach and avoids the subject.

The phase, "longer part of such 180 days" is 91 days.

11 USC 109(a) states, "Notwithstanding any other provision of this section, only a person that resides or has a domicile, a place of business, or property in the United States, or a municipality, may be a debtor under this title."

28 USC 1408 states, ". . . a case under title 11 may be commenced in the district court for the district—(1)in which the domicile, residence, principal place of business in the United States, or principal assets in the United States, of the person or entity that is the subject of such case have been located for the one hundred and eighty days immediately preceding such commencement, or for a longer portion of such one-hundred-and-eighty-day period than the domicile, residence, or principal place of business, in the United States, or principal assets in the United States, of such person were located in any other district. . ."

Now, I suppose one could argue that the 91 day rule only applies if you were in the US in some other district for less than 6 months but, I can tell you, I have had cases with Canadians who simply waited out the 91 days to file - the issue was never raised in any of those cases.

Des.

[specialop99]

Assuming I waited for 91 days to file, then on 92nd day, I fly back abroad to visit and take care of my family, then come back for the 341 meeting. Would I get a red flag if they see me flying in and out of states like that?

[despritfreya]

Assuming I waited for 91 days to file, then on 92nd day, I fly back abroad to visit and take care of my family, then come back for the 341 meeting. Would I get a red flag if they see me flying in and out of states like that?

There are no guaranties in life, especially when dealing with a court system. My recommendation would be to remain in the US until, at least, the 341 meeting if not the entry of the discharge which will be about 4 to 5 months into the case. And. . . where are you getting the $$ to fly abroad the day after filing? Was this $$ you had in your pocket and failed to disclose as an asset of the bk? Just opens a potential Pandora's box.

Des.

[specialop99]

There are no guaranties in life, especially when dealing with a court system. My recommendation would be to remain in the US until, at least, the 341 meeting if not the entry of the discharge which will be about 4 to 5 months into the case. And. . . where are you getting the $$ to fly abroad the day after filing? Was this $$ you had in your pocket and failed to disclose as an asset of the bk? Just opens a potential Pandora's box.

Des.

lets just say that 1 week prior to filing or on the 84th day, my parents gave me the money to fly abroad to my wife and child on the 92nd day. Then come back 2 weeks before the 341 meeting.

[despritfreya]

lets just say that 1 week prior to filing or on the 84th day, my parents gave me the money to fly abroad to my wife and child on the 92nd day. Then come back 2 weeks before the 341 meeting.

Then you better list either the $$ you are holding or the plane ticket you are holding on Schedule B and hope you can claim some exemption to protect the asset.

The problem is that you are trying to find a way to "game" the system. If you want to legitimately file bk to take care of your financial issues within the US don't play games or try to find ways around the "rules". Play it safe and then move on.

Des.

[frogger]

@specialop99 - As des has pointed out, complete and total disclosure is the key to a successful bk. If you try to game the system, you just might get away with it. More likely however, you will get caught and if so (to put it mildly), the trustee is not going to like you.

[LadyInTheRed]

1) Any way to protect my checkings account? Or should i withdraw everything and just have cash on hand?

Des' already told you this, but I wanted to make a point of it since it was your first question: Any cash on hand must be reported on your BK petition. Withdrawing it from your checking account doesn't change your obligation to report all cash you have on the day you file as an asset.

[specialop99]

thanks for all the advice. I got another question. Are attorneys allowed to pick their own trustees for their client? What is the relationship between the attorney and trustee and how it affects the success of getting the discharge of debt for the client? appreciate your help in this matter.

[despritfreya]

Are attorneys allowed to pick their own trustees for their client?

No. The Trustee is assigned by the Clerk of the Court on a rotating schedule - luck of the draw when a case is filed.

What is the relationship between the attorney and trustee.

Depends upon the attny and it depends upon the Trustee. I generally have a good working relationship with the Trustees and each knows how I will approach a case both as to the detail of information placed in the schedules and working towards settling any issues that may arise. I would imagine the longer the attny has been doing this, the better the attny's understanding of how each trustee will react to a particular situation.

how it affects the success of getting the discharge of debt for the client?

IMHO, the success in obtaining discharge is not in the hands of the attorney. It is in the hands of the debtor. So long as the debtor complies with the rules (disclosure, disclosure, disclosure), cooperates with the Trustee and does not face any complaints to deny the discharge either from a particular creditor or the Trustee the discharge should not be a problem.

Des.

[specialop99]

If you file bk, since you have not been in any one state for 2 years, I believe you will be using federal (not state) exemptions. There is no federal exemption for a bank account or cash on hand however, there is a wildcard which, I believe, you can apply to the bank account so you should be fine.

Des.

I met a paralegal today and he mentioned to me that i have $6,000 from federal exemption. How does the Federal exemption work? if I lived in Florida for more than 90 days, am I eligible to such exemptions?

thanks