Chapter 7 Expense question

[rockobuster]

If you are filing chapter 7 and under your expenses is listed a membership to a golf course, is there a chance that the trustee would deny it? (It is $300 a month for my husband and me, which covers unlimited golf, and all facilities).

If the trustee does deny this, then what happens? Would we have to give up our membership, or does the $300 go under our disposable income? If it goes under our disposable income, then we would probably have to file chapter 13?

[HHM]

If they object to the expense, then it becomes part of your disposable income. If your disposable income is high enough, then yes, you will be pushed into a chapter 13.

I would suspect that membership at a golf course is not considered a "reasonably necessary living expense" and therefore would probably be objected too.

The larger question is, what happened to push you into the verge of a chapter 7, and yet you are members of a country club?

[robivi3]

I'm a working schlepp with few luxuries and had a small business. The Trustee gave me a nightmare and "The Evil Eye" treatment and dragged us to court. That expense won't play well at all and you will likely leave the 341 with egg on your face.

Cell phone, not a luxury
Internet, not a luxury
Reasonable Cable, not a luxury
Country Club Membership, definitely a luxury

Don't take this as a put down, I don't know your business arrangements or necessities so I am not commenting on your specific situation, but he will. So, if you choose to include it be ready with a very solid answer in order to justify the expense. Also remember that he reports and deals directly with the judge, who will also take this into account when the trustee makes requests regarding your BK. It will likely be a subject of conversation in the office.

[rockobuster]

We were pushed into our situation because of gambling and large credit card debt. Our attorney is aware of the golf membership, and our disposable income is $300. We had wanted to file a chapter 13 since our credit card debt is high, but he thought we should try chapter 7.

I am bothered by this, but wanted to see if anyone else faced something like this from the trustee. This expense is the only thing we have listed out side of normal living expenses. We are reaffirming all of our other debts.

[rockobuster]

I'm a working schlepp with few luxuries and had a small business. The Trustee gave me a nightmare and "The Evil Eye" treatment and dragged us to court. That expense won't play well at all and you will likely leave the 341 with egg on your face.

Cell phone, not a luxury
Internet, not a luxury
Reasonable Cable, not a luxury
Country Club Membership, definitely a luxury

Don't take this as a put down, I don't know your business arrangements or necessities so I am not commenting on your specific situation, but he will. So, if you choose to include it be ready with a very solid answer in order to justify the expense. Also remember that he reports and deals directly with the judge, who will also take this into account when the trustee makes requests regarding your BK. It will likely be a subject of conversation in the office.

I don't understand what you mean by having to go to court. Does this mean that the trustee made you file a chapter 13?

What happened when you went to court? I thought the only time a person had to go to court was when they were filing a chapter 13?

[robivi3]

Chapter 7 is not necessarily a cut and dried guarranteed issue. As I state often the Trustee is not an Employee of the Federal Court. He is a wealthy Attorney, usually the head of a large firm with his name on his building. He is well connected. He takes all the cases, 95% of which he handles for free. 5% of all cases are asset cases. In my case I fell into the 5%.

In the end the Trustee dropped his pursuit of our assets because the assets involved were not worth his time. We did go Chapter 7 and were eventually discharged. If you have a home, hard assets, even the ones you are reaffirming may be worth more than you owe, it will likely not be a cakewalk. In your case you are discussing a gambling issue, Club memberships and i would imagine that given the little bit of the lifestyle you've revealed here you have some very nice things. I do not wish to cause alarm but you need to be REAL honest with your Attorney and he needs to be REAL honest with you. My Attorney told me up front that the Trustee would likely give me a problem over certain items. I hired him because he made no hidden suggestion that I lie, another flat told me what not to claim, i never went back to him. My wife was a Paralegal (I guess still is, but not working at it), the one thing that she has always said is, never lie to the Judge, if the Court finds out, you have zero credibility.

You should be sure that your Attorney is aware of everything. All I can say is it could be a difficult road. You are admitting the debts are legally owed. You are stating to the Court that you cannot pay these debts. The Trustee works on behalf of your creditors because you are asking the Court to dismiss these debts. And he will ask, why. This is Bankruptcy, if it was easy Credit Card Rates would be 96% and we'd do it every seven years.

You have to take the road though, come what may. There is a light at the end of the tunnel when it is over. I've been there and I can say that when it is over, you do rebuild. Set your mind to get through it. You will get notices, letters, reports, alot of mail that will give you a start. It is normal. Some folks here had easy, no asset BK's, some that should have been easy are having difficulty. Those who have passed through it can tell you, it does end.

I wish you and your family the best.

[rockobuster]

Thanks for the advice. What I am concerned about is the fact that I deposited 3 cash advance checks totally $15,000 a month before my attorney filed. I want to make sure I have what the trustee may be asking for. I withdrew this amount of money out of my checking/savings account at the casino using the ATM machine and then had to cover them with the three advance checks from three different credit cards.

We have 120,000 in credit card debt and a lot of it has come from gambling in the casinos.

I had to put the golf membership down on the expenses as that shows up as a charge on my monthly bank statement.

We have a 8 month old car, a car that is 11 years old and is worth 4,000 & 5,000 equity in our house.

I contibute monthly into my retirement account (is automatically taken out of my check) and have for 8 years. I'm wondering if the trustee will make me stop contributing and add that amount to my disposable income.

My attorney said that the trustee will be looking to see if this is a asset or no asset case. He filed on the 4th of the month, but it will show that I have 3,000 in my checking account, but that is because 2,300 had not cleared yet, even though they were mailed out on the 4th (there was actually 700 in the account - my husband and I get paid once a month on the 1st). I don't know what proof he will ask for and don't also know how the trustee determines at what point it is an asset case?

I appreciate any advice you can give, since we will be having our 341 meeting in a week.

[worriedbk7]

WOW---it sounds to me like your attorney did not advise you well. Sorry to say, but any cash advances/purchases within 90 days of filing are not dischargeable. And the trustee does not care what checks have or have not cleared yet. THey will take what money they can account for. I really hope and pray that things work out for you. Please let us know.

[worriedbk7]

By the way, my debt is also from gambling (around 50K) What state are you in?

[HHM]

Yeah, those cash advances are going to be problematic for you. Its not so much that the trustee is going to care, but I would expect the creditors to come out of the woodwork to object.

However, your still getting a better deal than doing nothing, even if you still have to pay back $15,000, that is far less than $120,000. So even though its not a "perfect" Bk, its still pretty good under "your" circumstances.

I think your challenge will be keeping your case in a chapter 7. But again, a chapter 13 is not a bad deal.

[rockobuster]

I honestly wanted to go chapter 13 but our attorney felt we had a good case in chapter 7. I'm still not sure this is the case.

If the three creditors do object to the cash advances totalling $15,000 and we agree to pay them the money, is there still a chance that the US Trustee will try and dismiss our case due to our disposable income?

Also, if our chapter 7 is dismissed and we go into a chapter 13, is there any chance that we could get dismissed there? If not, how do they determine how much you would have to pay monthly, given we would owe $120,000 in credit card debt? I'm told the longest you can pay is 5 years.

Thanks!

[HHM]

There is nothing wrong with what your trying to do, if your attorney thinks there is a shot at a 7, take it. The worst case scenario is that you end up in a chapter 13 (and that is not a bad thing). So there is nothing wrong with at least trying to do a 7, assuming your case was borderline.

So long as your attorney is on the ball (which I suppose is questionable at this point), then you shouldn't have too many problems, except that your BK will take longer than most.

Yes, a chapter 13 can be dismissed (but the reasons a 13 is dismissed are usually different than for a 7), but so long as you comply with the trustee, make your plan payments, etc, you should be fine

[rockobuster]

If the trustee does not dismiss my chapter 7 case, can't the US trustree dismiss it also?

I just wondering if there are objections from my credit cards ($15,000), and I agree to pay these three cards after the bankruptcy is discharged, at what point does it go to the US Trustee? Can he object to the discharge of the remainder $105,000? If so, then does it go to a chapter 13?

Thanks again.

[robivi3]

The Trustee is the US Trustee, he is the one and only. Search on the Internet for your Trustees Office and take a look at his website. It will give you a General idea of what kind of office you are dealing with. These are NOT ambulance chasers, these are cream of the crop Harvard fellows, well connected, mine graduated College in England and his wife is one the VERY top medical proffessionals in our County.

While I can't say i love the Trustee, I can say that I respect the man and the Office the further I get from my BK. They are very savvy at exposing hidden assets.

I think your Attorney could have used a little more wisdom. I hope he told you that there would be difficulties most likely. It should be difficult in cases of abuse.

Keep in the Forum here, I have the feeling you will need it. Notices will come, the natural reaction is to panic. You need to be ready for that psycologically so that you don't shed years from your life in an instant. No one is condemning you, you've been very honest and you will not pass this road again once you are finished in the journey through BK alley. This is a support group and we will be here.

[rockobuster]

I had heard someone say that they made it through the trustee in a chapter 7 and then it goes to the (I thought US trustee) but must have misunderstood. Doesn't it go another step further, like the Assistant Attorney General before it is officially discharged? I guess I am confused.

Do you know if you are contributing money into your retirement account (via payroll deduction) if that will be allowed? I have been contributing for 8 years.