Filing CH. 7 soon. What happens to my paycheck?

[LifeNLemons]

I am (hopefully) filing Ch. 7 next week. My payroll will be deposited on the 7th. I wanted to file prior to that to keep my check from being garnished again. But if I file Wednesday and get paid Friday, will the court freeze/hold my check? I can't get a paper check until next pay period, so it has to auto deposit. Should I just file on that Friday, knowing I can take it all out on Friday, pay my daycare, my rent, my insurance and buy groceries and have no $$ left to show for it? But then I'll be garnished for 25% of my check, which stinks.

How would that work? BTW- the garnishment is from my jerk of a stepdad, so would that be considered an insider payment?
Oh, and I'd ask my lawyer, but I don't have $$ for one. Sure wish that I did.

LifeNLemons - In Nevada and Broke.

[keepmine]

If you file prior to the next pay period, the automatic stay will kick in. I doubt 2 days will be enough to stop any garnishment but, you should get the funds returned fairly quickly.
No, no preference issue since, you're not paying voluntarily.

[SinkingFast]

If you file before payday,............. Maybe you could swing by the Bank and tell them you filed. Give them the Chapter you filed and your Case Number. Try speaking with a Bank Officer and not a Teller.

Maybe that will stop the garnishment from taking funds from your paycheck when you do get paid.

Hopefully, you'd get someone at the Bank who knows when you file BK an Automatic Stay goes in place against your Creditors. All debt collection activity must stop.

It's a thought worth trying.

Worst case, as Keep said,............ They'll go ahead and take the money per the garnishment order. Then you'd get it back later.

[LifeNLemons]

I know that if I file I can send a copy of the stamped paperwork to my Payroll dept and they won't deduct it.

But what about the actual money that goes in the bank? Is it considered part of the bankruptcy? Am I able to use it if I file before I get paid. Like, if I file tomorrow, I have $60 in the bank. But next friday when I get paid, it'll be like 1300. Does the trustee get that money? Or can I actually pay my living expenses with it? Or do I wait to file on that Friday, after I've taken the $900 or so I'll get after I'm garnished, and pay my expenses and have again, like $60 cash on hand?

[keepmine]

Your question is confusing. Of course you can use your bank account like normal to pay daily hh expenses. The issue is, how much cash does your state allow you to exempt?
You really need the balance as low as possible the day you file. That means, checks have actually cleared.

[SinkingFast]

The day you file sets your BK Estate. Whatever monies you have in the bank on THAT day is part of your BK.

Many States have an "Earned but Unpaid Wages" Exemption. You'd have to check your State's Statute regarding if or how much of your anticipated paycheck would be Exempt.

You also need to check on your "Cash on Hand" allowable. Or if you don't have a "Cash on Hand" Exemption, possibly you'll have a WildCard to protect any cash you have in the bank on filing day. Many Ch 7 filers typically dwindle their bank accts down as low as possible prior to filing.

Then, the money that's deposited into your bank acct the next day, 2 days, a week after filing has nothing to do with your BK. It's yours to spend as needed. To buy groceries, pay rent, fill up the tank of the car, whatever.

[LifeNLemons]

NV allows $1000 in cash. (Not that I ever have that much money in my account on any day other than payday, lol) So when I file it should be less than $1000 and after I've filed I can use it for my expenses just as I would as normal then?

And in being less than $1000, outstanding (uncashed) checks don't count, correct?

***ETA*** Okay, I was looking in the wrong place. I can't find a cash on hand exemption, but I see the wages earned but unpaid is a minimum of 75% exempt. (and its up to the judge if more is exempt)

[HHM]

If you have "uncashed" checks just sitting around and you file BK, those DO count as cash on hand.

[LifeNLemons]

If you have "uncashed" checks just sitting around and you file BK, those DO count as cash on hand.

I'm talking about checks I've written. If they haven't been cashed yet and taken out of my account. If they haven't been cashed, technically I still have the money on hand, right? So I need to withdraw the money and pay with cash or money orders for a while.

[rrockinggramma]

IMO, file just before you get paid. The day you file is the day your bank balance will be in question. Then as another poster suggested take your case number to the bank, your filing paperwork, and tell them not to garnish your check on payday. Some have assumed that if there were outstanding checks against their paycheck they were ok, but they were wrong. On the day you file, your bank balance is important. The day after you file, no big deal. If you file after you have your check deposited for 1300.00 then that money is available to the trustee to take to pay your creditors even if you have bills to pay.

[SinkingFast]

I'm talking about checks I've written. If they haven't been cashed yet and taken out of my account. If they haven't been cashed, technically I still have the money on hand, right? So I need to withdraw the money and pay with cash or money orders for a while.

Money from checks you write that have not yet been cashed is, indeed, Cash on Hand for BK purposes.

When you get that close to filing,.......... That's when most of us purchase Money Orders to pay our bills.

That way, there's no checks against your acct floating around out there possibly not yet cashed. The money isn't sitting in your bank acct. And the bills get paid as usual.

Be sure to save the receipts of MO purchase and the MO stubs. Attach the MO stubs to your bill statements as documentation, just in case you're asked.

[genseeker]

Absolutely file right before payday. Hubby got pay deposited on Wed so I made sure to file our papers on Tues. We had about $30 in the account on the day we filed. And if you have online banking, make sure to print out a screenshot showing your balance on the exact day you file.

There is a way to do an emergency filing where not everything has to be provided at the exact time you file. You have a few days to get your schedules and stuff together