100K limit? myth or real

[Lajazz947]

Also the 40k payment to an associate would be a red flag as well, I would assume the trustee would go after this money if you filed within a certian timeframe.

In regards to low income and a high amount of debt, I believe it is the sole responsibility of the creditor to prove fraud in application, not the trustee. In general fraud is extremely difficult to prove (meaning fraud at the time of application).

Lastly, On one of your vehicles you stated it was paid but you owed money on it to an associate, could you elaborate on this? Did you bought it from a dealer/finance company (or payed outright) and then used it to secure a loan from an associate? The trustee will defenitely want this clarified, and your answer may affect what happens with the vehicle.

I gave him the money in 3/08 so I expect a fight.

The car was purchased with money he lent me. I will definitely clarify it as needed for the TT.

[Lajazz947]

Regarding the litigation, are you suing your "friend" for the 300k? If so wouldnt you want to see how that played out (maybe you would no longer need BK). If the case is that you are suing your old associate for a large amount of money the trustee may very well wait to see what happens with that case.

Yes, suing him but its going to be a LOOOONG time before it gets straightened out so it might be a moot point by then.

I just filed the lawsuit in 1/08 in Sacramento in a very crowded circuit court.

Can a Trustee do this? I mean make me wait?

[Lajazz947]

Wow, I am jealous, 200-300 bucks a month in CC use would ruin me, but to you its akin to none! (Just pullin your leg, kinda)

I know, I know but its all relative.

It's REALLY nothing to most of my friends.

[Priceless ProSe]

well barely, less than $1500 ) in the past 6/7 months.

Wow, I am jealous, 200-300 bucks a month in CC use would ruin me, but to you its akin to none! (Just pullin your leg, kinda)

[Priceless ProSe]

Also the 40k payment to an associate would be a red flag as well, I would assume the trustee would go after this money if you filed within a certian timeframe.

Also, the 220k in unsecured, it was for home remodeling or it was a scam your friend got you involved in? This would be interesting to know what the money was borrowed for and what it was actually used for. Although some time has passed since you borrowed it, the sheer amount of money involved would make one think that it deserved inspection. Usually if you borrow money for home improvement and use it for other means it is looked down upon (possibly fraud), due to the fact that the home usually secures such a loan and there is no increase in the value of the home if you spend the money on something else.

In regards to low income and a high amount of debt, I believe it is the sole responsibility of the creditor to prove fraud in application, not the trustee. In general fraud is extremely difficult to prove (meaning fraud at the time of application).

Lastly, On one of your vehicles you stated it was paid but you owed money on it to an associate, could you elaborate on this? Did you bought it from a dealer/finance company (or payed outright) and then used it to secure a loan from an associate? The trustee will defenitely want this clarified, and your answer may affect what happens with the vehicle.

[Priceless ProSe]

Regarding the litigation, are you suing your "friend" for the 300k? If so wouldnt you want to see how that played out (maybe you would no longer need BK). If the case is that you are suing your old associate for a large amount of money the trustee may very well wait to see what happens with that case.

[Lajazz947]

Years as in more than one?

Now THAT would be a hassle since I shred them at t he end of each year but I guess I could request them from the CC companies, how ironic would that be?

[halloweendmb1]

Someone said they ask for years worth of bank statements, years worth of cc statements. How much of that is true?

[Lajazz947]

Nope, actually was making more at the time of the CC purchases, not less.

I lost lots of monthly income in 2007 (about $5000) and had a real hiccup in early 2008 but now back on track.

Thanks

[banca rotta]

The only red flags would be your income at the time of the credit purchases. A very low income and a very high debt may help their case that you borrowed money with no intention of paying. This holds true to credit cards & other loans. Not with student loans and medical debts.

[Lajazz947]

By the way, I really sympathize with everyone on this board. I know I am in better shape than most and I don't fell sorry for myself.

My unsecured comes from a real estate fraud done to me by a former childhood friend for about $300,000 for which
I am in litigation now.

The money I borrowed for my home was due to come back to me from him to replace but never did and now I am out of money save my income.

Thanks to all of you.

[Lajazz947]

OK, here's one for the boards advice on how a Trustee would scrutinize:

I fully expect to be scrutinized but I am ready. I took the means test many times and even plugging in higher income figures I seem to pass.

I would be willing to do a 13 if I had to since the discretionary income seems to be low even using higher income figures.

I want to state that I have absolutely NO FRAUD intent, no CC use ( well barely, less than $1500 ) in the past 6/7 months, no cash advances and serious attempts to pay creditors up until 2 months ago.

Well above the median income for California , about $130,000 in 2008, maybe more if things go right. 1099 so I pay my own taxes and have to save them monthly.

$220,000 in unsecured debt, no luxury purchases in 2006/2007/2008 , almost all of it for home remodeling.

Some cash advances in late 2006 but mostly for household expenses and robbing Peter to pay Paul.

All CC accounts closed now closed, voluntarily.

$700 per month in insurance premium, paid $6000 deductible this year already.

I have above average utilities with proof.

Very little in the bank now, one preferential payment for $40,000 to my associate in 3/08 who I owed money to with a promissory note drafted in late 2007.

Money came from my brother who owed me money.

Home worth about $800,000/maybe $850,000 depending on who you ask but I think $800,000 is more likely in this market.

Owe $763,000 1st and 2nd ($5600 a month mortgage)
$43,000 Mechanic's lien in litigation

Even at $850,000 the California exemption will take me very close with $75,000 exemption.

Three cars:

1 lease (upside down)
1 own but owe money on it to my associate (about even)
1 own (about $3000 worth )

Wife does not work outside the home, 2 small children, one adult child out of the house.

Sorry for the long post, I am WAY ahead of schedule.

My attorney has not even evaluated my case yet but I am just obsessing and trying to be as prepared as possible for my attorney, my 341 and the trustee.

[laurannm]

I think in Help!'s case though (correct me if I am wrong, Help), it is standard practice in her district to essentially perform a detailed audit on all above-median debtors. From the experiences posted on these boards this is not the norm in most areas. I think it also depends on how far over the median you are. If you are significantly over, then the UST may want to see more documentation than usual (based on posts I've seen on these boards)

[Priceless ProSe]

WOW! 347 pages! given my current workload at school and my familial obligations I would most likely doo-doo in the envelope and send it back to them.

But then again we dont have property, a job (anymore), or anything of real value besides a car I am surrendering. SO I dont know how much they could actually ask me for.

I do have one question (probably should be a different thread), at what time do they normally ask for this documentation? According to PACER there have been no filings in my case since we filed originally, and its been a couple of weeks. Im not getting antsy, I just dont want them to drop a bomb on me and expect me to come up with 300 pages a week before my 341.

[Help!]

I do know that the combination of a high unsecured debt load and above median income catches the UST's eye. The additional info. that the UST requested in our case was extensive - documenting every number in our petition with receipts, calcs., etc. We even had to provide copies of car titles, registrations, auto lease agreements, copies of all insurance policies (homeowner's/renter's/medical/auto) - the list of documents was six pages long. The stack, when we finally submitted it, was 347 pages. NOT FUN!