$8500 in checking

[OneDay]

we are filing monday. (in 5 days)

we have $8500 roughly in our checking acct.

What do you suggest we do?

Our attorney said to have less then $300 in the account.


I would think that a lump sum withdrawl will raise red flags?
Does a Trustee look into avg balance or anything prior to the filing date?


our debt exceeds $300k as it is a business/personal BK.

I saw payments less then $600 would not be scrutinized? We have family debts not being filed that we are wanting to pay back..

Suggestions?


Thanks

[familyof7]

I am not an expert but do you have that money promised to any thing yet checks written? I dont know what to tel you maybe make a few withdrawls.

[OneDay]

a bit more information about our situation.

-attempting to cover upcoming expenses that are not necessarly immediete but near future.

-We owe about $2800 on a 1998 Ford Truck, We have discussed paying this off as it is an exemption.

-The truck also needs tires within the next few months, Probably going to get new tires before filings. Roughly $600-750

-Windshield needs replaced also... $165

-Tried to pre-pay 3 months rent but our landlord company doesnt allow that ( Odd I thought ) and will take post dated checks but not cashing them until the due date.

-My wifes car needs some suspension work soon, and it may as well be now.


so with the listed above...


$2800 payoff truck
$750 tires
$165 windshield
$800 suspension work
totals $4510

leaving us roughly $4000...
buying groceries and necessary health related items.. We could tally up around $600 or so ...


totals...$3400



What will they say about cash withdrawls..I'm lost for words now..

[CATCHMEIFYOUCAN]

Hmmm, when you go to your 341 meeting you have to present current bank statements, does the $8000 reflect on that statement ?
When the Trustee asked one of the "21 question," lineup, do you have any cash on hand? I took it literally and dumped my pockets on the table and said 26cents. In the state of Virginia, you allowed up to $5000 in your account (though - which I didn't have).

So what am I trying to say, hmmm .. I can't say it directly.

CMIYC

[OneDay]

im not looking to have unreasonable cash on hand amounts.

I am looking for "acceptable" purchases and scenarios....

[HHM]

Suggestions?

Whatever you do, DO NOT FILE BK ON MONDAY

I am dead serious, because you will kiss the cash goodbye. The simple truth is, if you cannot exempt an asset at the time you file BK, it is fair game...unless you have a large cash or wild card exemption, you can kiss that money good-bye. (and if you don't pay the trustee, you will have your case dismissed or worse). The Trustee and BK code does not care about "future" expenses, there are no exemptions for "future" expenses. Unless your state has a cash or wild card exemption, you need to have very little money in your checking account (i.e. less than $300), and yes, any major withdrawal before filing BK that will reflect on your bank statements will be problematic.

Again Do Not File BK on Monday

[SinkingFast]

Personally, I'd delay filing too.

If you aren't under the gun being sued, Foreclosed upon, or some other dire circumstance, there is no reason to rush filing.

Give your bank acct some time to settle down. It will be very suspect to any outside party looking at your bank statements. Seeing $8500 there and only a few days later, Poof!! The money is gone.

Be sure to save receipts whatever you spend the money on.

[OneDay]

*let me clarify a bit... The listed expenses above are going to be paid for this weekend...
but there would be a balance in the acct above a $1k....




here is another issue.

both our jobs only allow direct deposit... so paychecks always go into checking accts every friday.

how do we go about keeping money out of our checkin acct?

we are also looking at a foreclosure on our condo...


I saw some info on 70/90 rules? what is this? first time I really seen anything on this b4 and our attorney hasnt mentioned it...

[OneDay]

70/90 questions...from reading other postings...


-70 day rule...cash advances aggregating more than $750 that are extensions of credit, (i.e. credit card convenience checks) are presumed fraudulent.

-90 day rule...charges (on credit cards), in aggregate of $500 owed to a single creditor that was incurred within the 90 days prior to filing BK "and" was for luxury goods and services are presumed fraudulent.


How does that related to "cash accrued" because we have stopped paying our creditors knowing we are filing BK?


When I spoke to 1 attorney about 6 months ago, his story went like this...

"If you were getting a tax return back before filing and you spend it oh well...Maybe your just irresponsible...
But if you get it back after filing the Trustee will be garnishing that money..."


thoughts?

[lrprn]

OneDay, what state are you in?

I agree with HHN and SinkingFast - given the information you've provided, unless you can exempt $8K in cash using your state exemptions (which is why I asked which state you are in), you are going to be in a world of hurt filing with that much cash onboard or trying to get rid of it a very short time before filing. There's no legitimate expenses I can think of that a trustee will find acceptable for spending $8K in five days before you file.

You need to let your attorney know immediately that you currently have $8K in your accounts and see what he/she advises you to do.

[HHM]

Prepaying expenses probably won't cut it. It is one thing to pay money you legitmately owe, but "prepayment" will probably be considered a "preferential treatment"

Again, I reiterate my advice, without knowing more, the worst thing you can do is file BK on Monday under your circumstances.

[SinkingFast]

As far as timing your filing,......... You get paid on Fridays,....... I'd file on Thursday. That's what we did. Filed the day before pay day.

The 70/90 day rules are as you've stated. Any cash advances (including convenience checks) within 70 days, or charges within 90 days prior to filing, in excess of the prescribed amounts, are considered fraudulent.

The Code says "for luxury goods and services" but Creditors will push that, and usually win, for any transactions within the 70/90 days. Even tho the Creditor has to prove intent, people know months in advance of filing that they are in financial trouble.

Several posters have commented recently about settling with Creditors on charges made within the 70/90 days. Paying back either in lump sum, or in payments, the $$$'s that were charged or the cash advances/convenience checks that were used.

[OneDay]

We have not touched any credit related accounts for a minimum 6 months.

The balance accrued in our checking acct is strictly paychecks.

We are Located in Colorado.

When I spoke with our attorney he was aware of the balance and just said have a balance less then $300 day of filing.

Would the above purchases in the 1st post be considered "fraudulent"?

[SinkingFast]

Those look fine.

Other things to consider,........... Go to the doctor if you haven't been in a while. If you need dental work done, see to it. See the eye doctor if needed. Get new glasses and contact lenses. Do you have life insurance?? If not, buy some. Get some clothes.

Think about necessary things you've put off because you've been sending all your money to the CC's.

[wrinkleigh]

In short, you can spend the money on necessary expenses -- BUT you cant get rid of that kind of cash in 3 days and expect it not to throw up some red flags.

DO NOT file on Monday. I would go ahead and spend the money and then give my bank account a month or so to settle back down -- so the statement you turn in to the trustee wont show these HUGE expenses paid so close together. It is OBVIOUS that you are trying to dump cash, whether it is needed expenses or not.

If your paycheck hits on Friday -- file on a Wednesday or Thursday.