Mortgage questions

[walley]

If you are about to file a ch 7, and you kept making mort payments, but not cc to save money for bk, wouldn't that be considered a preferance.

[BKTango]

We hadn't made any cc payments in a year except for one we had kept for emergencies, of course we continued our mortgage payments. You have to have a place to live. I don't know how they do that, our lawyer asked us about preferential payments and we said well our mortgage and we have settled with one of our other creditors a month prior (we didn't anticipate filing bk when we did) he noted this info down, but when it came time to actually transfer info to our schedules and what the trustee looks at it clearly stated any preferential payment to any UNsecured creditor. So only the settlement was listed for us. I'm not sure if it was different for other people but that's how it went for us. I think mainly they look for you paying off family and certian creditors or any large payout for fraudulent purposes, they wouldn't consider you making your regular mortgage payments fraudulent.

[HHM]

If you are about to file a ch 7, and you kept making mort payments, but not cc to save money for bk, wouldn't that be considered a preference.

No, because mortgage and credit cards are different classes of debt. A mortgage is a secured debt, a credit card is unsecured debt. You only violate the Preferential payments provisions if you favor one creditor over another within the same class of debt. Thus, if you made a payment to your AMEX, but not to your Visa, that would be a preferential payment. However, choosing to pay your mortgage over your credit cards is not.