Meeting with attorney, concerned

[RickInMich]

Hi,

Well, just to update everyone. I did meet with an attorney today. Actually, I have utilized his services about 7 years ago for a bankruptcy for my mother when she was dying. Hers was a very easy case, though.

Anyway, he seemed a little concerned regarding a truck being in my name that my brother actually bought (took over payments)from me. But his main concern there was that back in January I had borrowed $3,000 from my brother for about two weeks to pay off a card to turn around and put a balance transfer on that card to get a lower interest rate. I was doing the shuffling game then. But what he's concerned with is it looks like I paid my brother back on a loan. The truck wasn't his concern. He figured we could use it as an exemption. But even though I paid my brother back by paying off the balance on the truck, which was $2,000, and then directly $1,000 to him, he said that is still going to look like I paid back a loan. Theoretically, they can sue my brother for the $3,000.

His other concern was the balance transfers. As I mentioned, we played the shuffling game to get lower interest rates. Had I known I was going to file, I would have left well alone.

He said in his opinion there's like a 25% chance that those companies will object and then sue us? I'm not sure the word was sue. But he did say there could potentially be a problem. He admitted, though, that it's somewhat inconsistent. He said he's had cases where he was certain there would be a contest, and there wasn't. Then he's had cases where he was sure there wouldn't be and was.

He was sort of leaning towards Chapter 13 because he said these issues wouldn't present a problem at all in 13. But quite frankly, I truly believe we need Chapter 7.

So I did ask if it would behoove us to try to pay a couple more months to get farther away from all these things. He agreed with you all and said that definitely helps. But he also recognized our struggle right now in even paying minimums.

Well, I have a followup with him on October 11, by which time we will have all the paper work filled out, etc. He said pay the payments for this month and perhaps next month. That would help. I'm apprehensive, but glad to at least get this initial meeting over with.

I'm sure I'll have more questions, and I appreciate everyone's feedback so far.

Rick

[Lindsay]

I would make an appointment with another lawyer. I've heard that some lawyers prefer a Chapter 13 for clients. It is good that you were completely honest with him though. I've heard that alot of Chapter 13s eventually convert to Chapter 7.

I'd do a Chapter 13 myself but we don't have enough income for a plan. I heard that you don't have to worry about objections, losing property, ect and sometimes the payback amount can be low. From what I've read, I hear that Chapter 13 is less stressful, but the downside is that you have to pay some back.

I'm just reading and learning about this myself so hopefully someone will come soon who knows more about this.

[HHM]

Sounds like this attorney was upfront with you.

You should speak to a couple more attorney's. It sounds like he was only mentioning a chapter 13 as a way to avoid the potential challenges that you could face if you attempt the a 7, i.e. recent balance transfers, the loan to your brother, and the truck, and that is fair advice.

[BKTango]

You really should make a few more appointments with other attornies if at all possible. If you are under your state's median, and if I remember a previous post of yours than you are, you qualify for a chapter 7. Provided, you are current on your secured loans (homes, car, etc.), everything you have falls under your states exemptions and you have very little to no disposable income left over, then you should be looking into a ch7 not a 13.

As HHM stated, that attorney is kinda of giving you the heads up. But leaning towards a 13, to avoid any issues. You could put a little more time in before filing to avoid the balance transfer issues. Also make sure, you are not still paying on any debts you are planning on discharging. At this point continueing to pay on them is a waste of your money that could be used for living expenses.

[Boscoe]

Rick - you have documentation showing the trail of money from the brother's loan, that will help. As will putting as much time between these events (i.e. balance transfers) as you can.

Also, cc companies will not likely object if it has been at least 6 months and you have made a few payments on the balances. If you simply did a balance transfer, never made any payments and then filed, they would more than likely come after you.

Stick with the ch 7. See another attorney, and try to hold off filing as much as you can. And, of course, make as many minimum payments on the balance transfer accounts as you can...

[RickInMich]

Rick - you have documentation showing the trail of money from the brother's loan, that will help. As will putting as much time between these events (i.e. balance transfers) as you can.

Also, cc companies will not likely object if it has been at least 6 months and you have made a few payments on the balances. If you simply did a balance transfer, never made any payments and then filed, they would more than likely come after you.

Stick with the ch 7. See another attorney, and try to hold off filing as much as you can. And, of course, make as many minimum payments on the balance transfer accounts as you can...

Thanks, everyone. I didn't mean to imply the attorney wasn't completely up front or anything. I actually really like the guy and feel like he's very competent. He's been doing solely bankruptcy for like 30 years or so.

He did say, too, Boscoe, that it would be much worse if I balance transferred and didn't make payments. Luckily, that's not the case. It's just that the balance transfer (about 25,000) happened in February. That means I've only made six payments on that account. They are nearly $500 a month, so it does show I'm trying. I just wish there were more time from then until now.

I think I may try to keep payments current for Sep, Oct, and maybe November. That would nine payments total. Shoot. Or should I go all the way to January. So much to think about.

Also, I didn't realize you could go from Chapter 13 to 7. Would that be a good option?

Thanks, everyone.

Rick

[Boscoe]

Rick, the more payments you can make, the better. I think you could be ok now, having made 6 payments. Whatever you can do to keep making all payments will also help you on the other side of the bk in rebuilding your credit.

Let us know how it goes - keep going for that chap 7!

[Lindsay]

If you've already made six payments, I would think that would look good. I'd still check with another attorney in the area to get a feel for what usually happens. He is saying a 25% chance of them objecting, so they probably won't object. Sometimes people have good intentions and then when they actually add up everything, do their budgets versus income and debts, they realize that they are truly bankrupt.

It sounds like you were transferring balances to try to lower your interest so you could pay your debts and it just didn't work out that way.