Credit Card Charges - pre filing~ allowed?

[backtoschool]

Our income is over the montly median by about $1200. I expect to be srcutinized. But I intend to follow the letter of the law - They can poke and prod all they want.

With the large cash gifts, the appliance purchases for an improved home, and your income being over the median by that much, expect the US trustee to get involved. You are a candidate for a totality of circumstances dismissal in my opinion. I would discuss this specific concern with your lawyer and be ready to have very good documentation and specific reasons for why that money went into improving an exempt new home and not to your creditors. The trustee and US trustee will be very very interested in your bank account statement, credit card statements, and income tax returns going back several years most likely.

[ozarkmiss]

it never crossed my mind that we might be looked at unfavorably. We paid the creditors (minus the 1st underwater mortgage) - over the minimum - while building. Didn't realize we were bankrupt until the dust settled. The I and the J show us as bankrupt. But I can clearly see your point. I am willing to fight a dismissal should that happen. But am going back to the drawing board as far as timing goes.

Sincerely appreciate everyone's insight.

[AngelinaCatHub]

OK, hub's unemployment ran out, but you said you are 1200 over the median, can you pick up and continue to pay evenly all your CC's? At least until the CC with the appliances on it is paid down below the appliance costs? Beware though, you must pay equal so as not to look preferential. Time is your friend as B2S emphasizes and I strongly advise.

I too am rebuilding a house and I pay cash, stick by stick. I have plenty to do even with no materials as I then do my preparations for the next step when materials will be available. It is a long and big job, I know. Longer and bigger without money to buy materials. But, what is more important, a fight to get a fresh start, or suffer a bit more longer for a smooth sail?

What we did wrong, got us a 10.5K levy and a two year open asset case due to poor lawyer advice or in our case NO advice. We being too ignorant to know what to ask. Everyone here is telling you that you need more 'distance' between your purchases and that gift. If I were a Trustee I would have asked, why didn't you take PART of that 5K payment and pay some bills first, and the rest for sticks in the house? As B2S stated, you really don't want the UST to slap a "presumptions of abuse" upon you to slow down progress. Slow down the process on your own terms, not his or theirs. 'Hub

[ozarkmiss]

Time is your friend

This may be the most important advice of all.

I too am rebuilding a house and I pay cash, stick by stick. I have plenty to do even with no materials as I then do my preparations for the next step when materials will be available. It is a long and big job,

Would love to follow your progress. It's so rewarding

What we did wrong, got us a 10.5K levy and a two year open asset case due

I am going to wade through old posts and find your history tonight. Or can you point me to a thread that encapsulates it?

Slow down the process on your own terms, not his or theirs.

This is really good advice / reminder. We can feel in control through all this!

[backtoschool]

I think you can avoid problems with the US trustee, if you wait a bit more time, and make a few "good faith" minimum payments to your credit cards over the next couple of months. Filing now would raise too many red flags. Time will heal this.