preferential payment and co-signers

[okiemom2008]

In May of 2008 we transfered our credit card balances onto a relatives card that was 0% interest. Total of 6600.00

In June of 2008 we paid the 6600.00 off not having any idea we would be filing bk later.

We are filing sometime in February. I listed it where it asked about a year back and relatives--

Basically, what is the worst that can happen? I really do not want this relative to know we are even filing much less get a bk on their credit due to me!

Thanks!

[TEW]

Preferential payments goes back 90 days.

[JRScott]

I'd wait til after May before filing.

They can go after your relative and seek the money from them.......

[Trixie007]

Preferential payments goes back 90 days.

I'm a little confused - wouldn't this be an insider payment with a lookback of 1 year? I suppose it depends on whether the money was given to the relative or paid directly to the cc.

[fltoo]

Since you listed it under payback to relatives, Trix is right, look back is one year.

Can you wait a few more months until June to file? What did the attorney say about it?
The trustee can avoid this transaction and go after the relatives for the 6 grand.

[okiemom2008]

Since you listed it under payback to relatives, Trix is right, look back is one year.

Can you wait a few more months until June to file? What did the attorney say about it?
The trustee can avoid this transaction and go after the relatives for the 6 grand.

I cannot wait due to the stress and starting to get judgements from everyone. I want to file and get it over with. Can I just offer to pay the trustee 6600 to not go after my realtive?

[Willy13]

I suppose it depends on whether the money was given to the relative or paid directly to the cc.

Does anyone have any actual experience with paying back an insiders card directly? I'd love to know how this has been dealt with in actual BK cases. In my case I was an authorized user and used the card and then paid it off.

[AngelinaCat]

Your trustee may give you that option. We had two preferential insider payments--one to a son-in-law and the other to a god-daughter. The total amount was a little over $6000 with $1300 to SIL and the rest to the god-daughter.

Our trustee offered us a compromise of $5000. We jumped at that because the relationship between the SIL and our daughter is rocky at best. If they had gotten served with papers about the $1300, that would be the end of any kind of relationship.

The problem with the compromise was that the money had to be paid in a lump sum. We were not offered a payment plan. This was in August 2008. However we get a yearly stipend in January from a Trust, and the trustee was willing to wait until then for the payment.

You may have to go through a process called the Rule 2004(b) Examination. But you may not.

Talk to your attorney about what options you may have. Good luck to you.

[okiemom2008]

Your trustee may give you that option. We had two preferential insider payments--one to a son-in-law and the other to a god-daughter. The total amount was a little over $6000 with $1300 to SIL and the rest to the god-daughter.

Our trustee offered us a compromise of $5000. We jumped at that because the relationship between the SIL and our daughter is rocky at best. If they had gotten served with papers about the $1300, that would be the end of any kind of relationship.

The problem with the compromise was that the money had to be paid in a lump sum. We were not offered a payment plan. This was in August 2008. However we get a yearly stipend in January from a Trust, and the trustee was willing to wait until then for the payment.

You may have to go through a process called the Rule 2004(b) Examination. But you may not.

Talk to your attorney about what options you may have. Good luck to you.

Thanks for the advice! Did the son in law or god daughter ever find out? I just don't even want this relative knowing we are filing due to personal reasons.

In your opinion, do you think the trustee will even see it? My lawyer only asked for 7 months of bank statemetns so none of these transactions were on there. But I did have to fill out worksheets and put that about the relative.

[okiemom2008]

I suppose it depends on whether the money was given to the relative or paid directly to the cc.

It was paid directly out of our checking and onto chase.com website

[TEW]

I'm a little confused - wouldn't this be an insider payment with a lookback of 1 year? I suppose it depends on whether the money was given to the relative or paid directly to the cc.

OP is or did not paying the relative but chase.

[fltoo]

[QUOTE=okiemom2008;244621]It was paid directly out of our checking and onto chase.com website[/QUOTE

Since it shows you paid a cc directly, it probably would have never been noticed unless you had noted it on your questionnaire.

What did the lawyer say? I can't believe he would let you file without resolving this first? Maybe he thinks it is not a pref payment since it was paid to the cc?

[TEW]

[QUOTE=fltoo;244626]

It was paid directly out of our checking and onto chase.com website[/QUOTE

Since it shows you paid a cc directly, it probably would have never been noticed unless you had noted it on your questionnaire.

What did the lawyer say? I can't believe he would let you file without resolving this first? Maybe he thinks it is not a pref payment since it was paid to the cc?

I don't think there is anything to resolve it's like a cosigned loan that's been paid off
there were no payments made to the relative.

[okiemom2008]

[QUOTE=fltoo;244626]

It was paid directly out of our checking and onto chase.com website[/QUOTE

Since it shows you paid a cc directly, it probably would have never been noticed unless you had noted it on your questionnaire.

What did the lawyer say? I can't believe he would let you file without resolving this first? Maybe he thinks it is not a pref payment since it was paid to the cc?

We have not filed yet but are soon. We have filled out the worksheets out but he still wants more paperwork from us-just little things that I am working on getting before we can file. And we are waiting to get the tax refund before filing. I hope that it is not seen as an insider since it was paid to Chase but I have my doubts!

I did write it on the worksheets where it asked about paying any money for the benefit of a relative in the last 365 days.

[okiemom2008]

[QUOTE=TEW;244627]

I don't think there is anything to resolve it's like a cosigned loan that's been paid off
there were no payments made to the relative.

I really hope this is the case. Thanks for the help!