New with a few questions

[funEface]

Evening all! I found this forum yesterday and figured I'd jump right in. We had a meeting with a lawyer last Thur and have decided to go with him in filing our ch7 (just have to come up with the $ ) He sent me a contract, a list of items I need to provide, and a worksheet to fill out.

Background info before I get to my questions . We will file joint. Have about 65k in cc debt and 2 auto loans that we plan on reaffirming. Well under the median income as I'm a full time student, just his income and we have 3 kids.

Now for the questions...I plan on seeing the lawyer again on Monday but figured it doesn't hurt to ask people who have been through it recently.

1. We have our checking & savings account at the same bank as our auto loans, each have a credit card, and auto/renters insurance. Would it be wise to switch to another bank for checking/savings right about now? Just wondering how they are going to feel about us IIB the credit cards (10K) but wanting to keep our autos and bank accts.

2. We own a motorcycle free and clear. The auto exemptions were going to be claimed for the two vehicles and our lawyer said that the trustee is probably going to want to take the motorcycle (worth 2500 running...which it's not right now). Would we be able to sell the motorcycle for a fair price today and use that money to pay our legal fees/living expenses? (it would be sold to family but honestly for what it's worth and could be documented) I'm stressing about coming up with legal fee $

3. Do federal savings banks generally have cross collaterization clauses or is that credit unions only? Again, worried about the credit card/auto loan situation with our bank.

4. We usually get a sizeable tax refund due to EIC and Child Tax Credits. The lawyer said filing at the end of this month the trustee is going to want 2/3 of our refund due next year. I have no problem with giving them 4k to wipe out our 65...but I thought I read somewhere that EIC is a welfare benefit and generally not taken. (We're in KS and using NV exemptions)

5. When filling out the worksheet about our assets...which dollar value do I use from kbb to figure the "market value" of our vehicles?

I think that's it...for now. Thanks for any input!

[SinkingFast]

Hi FunE and Welcome to the Forum!!

Personally,.......... I wouldn't sell the motorcycle to anyone if you're planning to file soon. Selling any sizeable asset close to filing is suspect and just throws up red flags with the Trustee.

Even more so if you sell to family. Family, friends, and close personal business Associates are considered Insiders. The Trustee can go back to your family member and seize the motorcycle from them.

If you absolutely, positively need to sell, be sure you document, document, document. CYA yourself with a paper trail. Write up a Bill of Sale that clearly shows who you sold to, for how much, have the other party sign the Bill of Sale, and be sure to deposit the funds directly into your bank acct. That way the Trustee can see the flow of funds into and out of your bank acct on your Bank Statements.

I believe I've read that EIC and Child Tax Credits are expressly off limits to the BK Court in KS. I believe there's been a Local KS Opinion rendered on that subject. Hopefully someone else will chime in for you that knows for sure.

Otherwise,......... There's a handy dandy IRS Withholdings Calculator you can use to guesstimate about your refund. You can file, and then change your withholdings/dependents number to alter the size of your refund.

http://www.irs.gov/individuals/artic...=96196,00.html

Look at all the vehicle values websites. KBB, NADA, Edmunds. Unless your attny specifically said to use one or another.

Which value will depend on the age and mileage of the cars. If we're talking old beaters, 10+ years old,........ You're probably looking fair condition at best. Our attny took all 3 values and averaged them. Some folks go with Private Party sale price.

Dunno about the bank situation. You may have some sort of Cross Collateralization Statement in your CC agreements that covers the bank either way in case of default. You'll need to pull those statements out and read thru them very carefully.