$1,200 in bank do I wait til after rent to file?

[ProSefromCA]

Hi all, I found this forum and it's exactly what I'm looking for! I've been reading and thanks to all the people sharing helpful information! I have a question because I am new and filing with no attorney (pro se).

I made the decision to file because I learned a civil suit may be filed against me soon. I am self-employed working on Internet web sites. I got into debt after trying some web business years ago (got taken advantage of). My income is nothing except for when I do work for a big client that pays in lump sums like 5k. I then use that to pay rent/bills in between work. I'm in a rush to file since learning of the lawsuit, and because I may be able to start web sites soon which might boost my income, but that outcome is uncertain. I'm waiting to start those sites until I take care of this, so things don't get harder. My tax return for 2006 shows total income of only $9,738, which is where I'm at, so I shouldn't have much trouble qualifying for Chapter 7.

I read on here that you should not file with over $300 in the bank. I have about $1,200 but will pay $700 for rent July 1st. After groceries and bills I would be down to about $300. But I want to file asap, like by June 15-20 since it takes time to get to the 341 meeting. I could file with $1,200 but it would be gone by the 341 meeting, so should I wait til I write the rent check on July 1st? After it clears? Any help is greatly appreciated!

[demismom]

Any chance you can just write the rent check now and not wait?

[SinkingFast]

Hi ProSe and Welcome to the Forum!!

The $300 thing really varies according to the State a Filer lives in. Whatever post you read the person was told not to have more than $300 in their bank acct on filing day,............. That was probably because that's all the exemption that person had left to cover cash. More than $300 on hand on filing day and the Trustee could take the excess monies.

I'm guessing you live in California.

California has a 2 tiered Exemption System. You must chose one set or the other. You cannot mix and match. Some Exemptions from this set, others from that set.

I don't know what all else you need to cover, but,.......... System 2, of the CA Exemptions has a $925 WildCard you can use to cover any property.

Also, a thought for you about paying your rent,........... Technically, you aren't supposed to prepay expenses. I don't know about you, but we always mail our rent within days after the 15th of the month so we're sure our Landlord has it to post on or before the 1st.

Buy a Money Order from Wal-Mart for $0.39 in the amount of your next month's rent. Fill it out and drop it in the mail to your Landlord. Poof! Money is gone from your acct AND you've got your rent paid to boot.

Personally, I'd recommend you pay cash, or use Money Orders or a Debit Card for any purchases you make between now and filing anyway. You don't want someone to sit on a check for a couple of weeks leaving you with an artificially large balance in the bank. The Court doesn't look at what checks you have out against your bank acct. It's how much money is physically in the bank on the day of filing.

[magyar123]

$1200 in bank................

Don't worry about the $1200 in the bank...unless your account is in a credit union, and you file on one of their products, credit card or loan. Since you make substantially less than the state's medium, and probably are within your state's exemption amount, you should have no problem filing.
If, however, you are with a credit union, and include their credit card or loan in your petition, I would advise you to switch banks just before filing. They will steal your funds.

[SinkingFast]

Don't worry about the $1200 in the bank...unless your account is in a credit union, and you file on one of their products, credit card or loan. Since you make substantially less than the state's medium, and probably are within your state's exemption amount, you should have no problem filing.
If, however, you are with a credit union, and include their credit card or loan in your petition, I would advise you to switch banks just before filing. They will steal your funds.

If ProSe can't cover his/her bank acct with an Exemption, the Trustee will take the money.

[ProSefromCA]

Wow, thanks for the great and fast replies!!!

That's great advice. Yes, I live in California, and my money is in a credit union, but I don't owe the credit union anything. I usually walk downstairs and hand in the rent check to the manager's office, but I guess I could mail a money order on the 15th. I won't use any checks, then. Thanks. I'll also stock up on groceries and pay cash.

One last thing is that I used my last lump sum check to buy a $550 laptop. As I said I work at home on computers, and my desktop is so old/outdated it can hardly load some of the technologies I use on clients web sites. A trick I have used in the past is buying a new laptop, and then when short on rent/bill money sell it off on ebay after a few months for very little loss. So I currently have this new laptop worth about $550. I don't have anything else I can think of of value over $100 that would be of interest. I'm thinking I should go ahead and sell the laptop to cover all the fees and online counseling classes that need to be paid. Then tough it out again with just the desktop, but if I don't sell it would it definitely get taken? My income level is so low I think they would not take it... especially under the $925 System 2 wild card SinkingFast mentioned...

[SinkingFast]

System 2 has a $1750 Exemption for "Tools of the Trade". Since you use the computer for your work, it would qualify as a "Tool" of your trade.

So the laptop should be Exempt for you to keep.

[ProSefromCA]

Thanks SinkingFast! This is looking easier than I thought. I'm going to look into online courses tomorrow and getting the online book from nolo I read about here since I'm filing myself. With the help of this forum and the book I should be able to avoid any snags! Thanks again!