Preferential Payments

[endisnear]

Can someone please explain exactly what is considered a pref pymt? Is it a toal of what's been paid to XXX in XXX amount of time, or just lump sum over XXX amount? We may be filing, and with the extra money we have since we're not paying bills, i was wondering if we could pay back family we owe $ to, but wasn't sure if doing pymts under a certain amount is ok, or lump sum up to an amount, or just don't pay at all??? Is there an actual definition the trustee goes by?

[magyar123]

Yes it would be considered a preferential payment if you only pay back your family but not other creditors.

[endisnear]

what about only paying some creditors and not others? is that the same, or is it because family are considered "insiders"?

[magyar123]

Same thing. Family is considered A creditor. To get around involving family in your filing and the preferential repayment issue, just pay them in cash or money orders.

[endisnear]

sorry, maybe i wasn't clear....is it ok to pay some of your creditors and not others? (family excluded)

[HHM]

sorry, maybe i wasn't clear....is it ok to pay some of your creditors and not others? (family excluded)

Depends on the class of creditors and how much.

You can pay your secured creditors in preference to your unsecured creditors.
Within unsecured creditors, so long as the amount paid is less than $600, you are ok. If its more than $600 for any given payment, then it is a preference.

Big picture, preferences are not that big an issue for the debtor, all that happens is the trustee sues the creditor you paid to get the money. Thus, that is why there is such a big problem with paying back family members, do you really want the trustee suing your uncle who loaned you $2000.

Generally speaking, if you are going to file, you should stop paying ALL your unsecured creditors. The only exception would be if there were recent transactions on those cards to avoid a possible creditor objection.

[floridian]

arent you supposed to pay on a cc for ninety days after your last transaction to prevent the cc company from filing an objection?

[endisnear]

*

[endisnear]

arent you supposed to pay on a cc for ninety days after your last transaction to prevent the cc company from filing an objection?

see the end of HHM's post

[magyar123]

arent you supposed to pay on a cc for ninety days after your last transaction to prevent the cc company from filing an objection?

Short answee - no.
Objettions as to dischargeabilty are usually done up to 60 days after the 341 hearing - not before you file.

[okiemom2008]

arent you supposed to pay on a cc for ninety days after your last transaction to prevent the cc company from filing an objection?

and even if you are late on them do you still pay them. Say you purchased something on Oct. 25 on a store card foe 70.00. You paid Oct, Nov payments but late on December. Does it matter if your late?

[AngelinaCatHub]

and even if you are late on them do you still pay them. Say you purchased something on Oct. 25 on a store card foe 70.00. You paid Oct, Nov payments but late on December. Does it matter if your late?

The more time after using the CC the better. Don't use them at all as when you are discharged you will have to go on your own. DON"T USE them. 'Hub

P.S. It could look like abuse.