$800 payment to creditor

[Jengo]

I was browsing again the forum and saw that if there was a payment for more than 600 to a creditor in 90 days before filing BK, that it is considered preferential and that the Trustee will ask the creditor to give it back. Is this true? Who gets the money back? My wishful thinking but since mine is a no asset case, etc., and will be a complete discharge of debts that can be discharged, do the creditors get equal portions of that 800 bucks or do I possibly and hoping hoping hoping that I will get it back. Wooohooo.....please, please, please give ME back the 800 bucks !!!! Highly unlikely but just curious.

[lrprn]

I was browsing again the forum and saw that if there was a payment for more than 600 to a creditor in 90 days before filing BK, that it is considered preferential and that the Trustee will ask the creditor to give it back. Is this true? Who gets the money back?

Sorry to burst your bubble, but any money your trustee takes back due to a preferential payment goes directly (do not pass Go, do not collect $200 ) to your creditors. Also your Ch 7 non-asset case becomes an asset case, often delaying your closing (but not your discharge).

[Jengo]

Sorry to burst your bubble, but any money your trustee takes back due to a preferential payment goes directly (do not pass Go, do not collect $200 ) to your creditors. Also your Ch 7 non-asset case becomes an asset case, often delaying your closing (but not your discharge).

I figured that. *sighing* Now another question if you know, is that a bad thing in delaying the closing of my case? If it is a bad thing, how is it bad?

Since it turns into an asset case, that 800 bucks wasn't technically mine. At that time, I was borrowing money over an extended period of time to pay for doctors and so forth trying to free up my own money to pay legal fees at that time. This is listed in my BK petition and who I was borrowing money from and their turning into a creditor when I filed.

[Jengo]

Oh, now I wonder if this is going to get complicated. I just thought of something. I had a doctor's appointment for my son that I think was like 1100 or so that I had to pay out of my pocket and that was last November. They're not a creditor. It was for services rendered to be paid in full at that time. Will the trustee go after this doctor for the money back

I also paid another attorney for a second opinion in December for $975, this is before I thought I was going to have to file for BK in January. They weren't listed because it was pay in full for services rendered on the spot so I did.

Technically neither one is a creditor that I owe money too but it will show in my bank statements of checks being sent out to these people. Is it only considered preferential if it is a creditor that you owe money to and you give them the 800 to pay the debt that is owing, etc., etc., although doesn't make a dent in the amount that is owed.

I hope that made sense.

If this doctor and lawyer would be considered preferential and considered creditors, although weren't named as creditors, that would suck if the trustee goes after them for the money back. I don't think they would because they aren't a creditor and I owe them nothing. It's just my insurance didn't pay for it and it was a medical necesity for my son. The second opinion from the lawyer was just that. We had a case going on and this is when I found out that my prior legal representation butchered our case all to hell and then I fired them. And then they claimed I owed them 50,000. got their final billing, had a mini heart attack and knew there was no way in hell I could pay back all my debts. That 50,000 was the straw that broke the camels back and what pushed me into filing for BK.

[Shawshank]

You are correct in your thinking, they are not creditors and are legitimate expenses.
You may be asked what they were for, but that's it.
If you are a no asset case anyway, and the only issue is a eight hundred dollars to other creditors in a 90 day time period, I would be surprised if the trustee would even worry about...that's my opinion anyway.

[coolmom04]

We have the same thing going on - $675 to one particular cc that we took cash advances on in December, so I wanted to pay them at least 3 payments before we filed.. but I accidentally paid four b/c of auto draft. Ugh. Anyway, we also have $1100 insider payments to deal with... this is going to be fun lol

Just out of curiosity, they don't go after the secured creditors do they.. I mean we had to list the vehicles and the mortgage on there as being paid more than $600 in the last 90 days. We're surrendering the vehicles, but keeping the house. They won't go after WF for that money will they?

[OutofTime]

We have the same thing going on - $675 to one particular cc that we took cash advances on in December, so I wanted to pay them at least 3 payments before we filed.. but I accidentally paid four b/c of auto draft. Ugh. Anyway, we also have $1100 insider payments to deal with... this is going to be fun lol

Just out of curiosity, they don't go after the secured creditors do they.. I mean we had to list the vehicles and the mortgage on there as being paid more than $600 in the last 90 days. We're surrendering the vehicles, but keeping the house. They won't go after WF for that money will they?

hah! I'm in the same boat, bill pay and spouse sent a check exactly @ 600 total. 100 payment sent end of Dec so in April I will file because it's under 500 for pref payments and that creditor can keep it. Mortgage and car loans are not considered prefential payments btw.

[Jengo]

In my case, I don't think they can come after me or what have you and demanding payment back or to turn over the "goods" so to speak. The 800 buck payment was to a prior lawyer that butchered our case all to hell. There is a tremendous hatred for this particular prior creditor. I will take great deep personal satisfaction if he has to pay the trustee back the $800 to distribute evenly to all my other creditors. bwhahahahah If I ultimately have to pay him the $800 back, that's fine with me as well because I will still take satisfaction in knowing that that is all that he is worth because all the rest that he "claims" he is owed will be discharged. LOL

If my thinking is wrong in this, please do clarify.