Forum Rules (Everyone Must Read!!!) (updated: 04/28/2015)

Welcome to the Bankruptcy Forum. Bankruptcy (BK) Forum is known as and will be referred to as BKF hereinafter. In order to ensure a long term success of our vibrant community, we have established certain rules and guidelines to which everyone must adhere to. Please take your time to carefully read our rules, before you start to participate in the community.

Things you agree to do: (BKF) users agree to use the search function before starting a new thread. This prevents duplicate discussions and allows for better organized topics.

All BKF users agree to read the sticky posts which may be available at the top of a forum page. These Sticky posts often contain valuable information. They may also outline more rules and guidelines specific for that particular forum, stickies are put in place by that forums moderator(s) or admin(s).

Things you agree not to do:

All BKF users agree not to call people names or write a post simply to make a personal attack, or get a negative reaction; this behavior is not allowed on our forum. The use of derogatory language aimed at anyone will be severely dealt with. There is no need to agree with each other, or to even like each other. However, by signing onto you agree to treat each member and guest with the respect they deserve. No threats or personal attacks will be allowed.

All BKF users agree not to discuss, engage, or encourage any behavior or activity which violates the law. Discussion of drugs, violence, murder, theft, vandalism, fraud or any other issue which could be used to help individuals break the law is strictly forbidden.

All BKF users agree not to "bump" old threads, unless there is a specific benefit to the community by doing so. But in most cases, please don't post in very old threads, instead start new threads.

All BKF users agree not to attempt/use another members account. It is against BKF rules to use any account other than your own. Impersonating another member will result in an immediate ban. It is also against the rules to open more than one account in your own name without permission from a moderator or administrator. If you have been banned for any reason, it is against the rules to open another account. If you were banned temporarily and you are caught using another account you will be banned permanently. Choosing a moniker which is similar in either sound or spelling as a moderator or administrator is strictly forbidden.

All BKF users agree not to private message any moderator, admin, or other member with questions related to their personal circumstances (Questions about the forum or issues with the forum are ok). This forum only works when members share their experience and insights with everyone.

Things you agree not to post:
All BKF users agree not to post any derogatory/racist/or sexist remarks. This includes attachments, links and all information contained within posts, signatures, and avatars, failure to comply with this rule will result in a permanent ban.

All BKF users agree not to post any copyrighted or trademarked information without the express written permission of the owner(s) / proper citation of source.

All BKF users agree not to post any real names, addresses, telephone numbers, email addresses, social security numbers, or any other personal details (their own or other people's).

All BKF users agree not to post links, pictures, attachments, videos, or the like of pornographic content, objectionable material or extreme violence, whether cartoon or real.

All BKF users agree not to use BKF for advertising purposes without a written contract between yourself/company/agent and the administration of BKF. Blatant advertising will result in a ban.

All BKF users agree not to spam the forums. Spam includes but is not limited to posting erroneous, non-relevant-useless, off-topic, or meaningless posts. Spam may also include posts which contain no text, or large areas of blank space between lines. Simply posting emoticons without text is considered spam. BKF is the largest bankruptcy message board and all the content is intended to help other users. Please help us improve the quality of our forum by making sure that your posts are well-worded, spell checked, grammatically correct and syntaxed.

Regarding actions of moderators and administrators:

The forum is no place to air out your opinion or be judgmental of our staff and its capabilities.

All BKF users agree not to abuse or mistreat moderators or administrators. It is against BKF rules to post any information regarding bans or any other action taken by a member of the moderating or administrative team. If you wish to discuss bans or warnings please do so via PM. To place a complaint against a moderator, send a PM to a super moderator. All Moderators are equal, any decision made by a moderator must be adhered to. If a moderator tells you something you do not like, do not go to another moderator looking for a different answer. If you are caught doing this you will be banned. The moderators work as a team and respect the decisions made by their peers and will help enforce them unless an administrator tells them differently.
If you have an issue with how the forum is run, then notify one of our administrator and we will look into the situation. We have in the past and still do appreciate any input that you offer this forum. But critical input and/or judgmental postings towards the staff will result in you getting banned.

Should you find a thread offensive or out of line, then notify a Mod in a PM so they can evaluate the situation and do the action deemed necessary.

All moderators do have active "other" lives outside of the forum and help moderate this forum in their spare time throughout the days and weeks.

If you have a problem with a member or Mod follow the proper channels of reporting it.

BKF reserves the right to delete any posts which contain anti-BKF comments or discussion. Any bashing of moderators or administrators, or any of their discussion or actions will also be deleted, and the responsible posting party(s) will be banned. Any public anti-BKF advertising, communication, or posts on another forum will result in permanent bans as well.

All warnings and bans are decided by individual moderators and administrators. Warnings are preferable to bans however, for serious offenses and repeat abusers bans will go into effect. The length of the bans can vary from several hours to permanent.

All messages posted or sent including through PM are the property of

All BKF users agree not to advertiser on the forum (Niether by posting, private messaging or using your signature). If you are a company/attorney/legal adviser wishing to advertise on the site or sell a product, you must contact the head administrator and inquire about our advertising packages.

All bankruptcy related opinions expressed on are those of their authors and not necessarily of BKF, its staff or representatives.

You agree not to copy any material/post/content from BKF without written permission from our head administrator .

By posting on this forum you agree to these terms and conditions, including any punishment deemed appropriate by moderators or administrators in the event of an offense.

Administrators/Moderators can change these rules at any time without prior notice.
See more
See less

before and after attorny

  • Filter
  • Time
  • Show
Clear All
new posts

  • before and after attorny

    Perhaps someone with more experience can speak about this.
    I read somewhere , That their are certain transactions that might be okay before you meet with a Lawyer, but those same Transactions would be be a problem if they happan after you met with a Lawyer.

  • #2
    We don't like to deal with hypotheticals.
    You'll save us all a lot of time if you'll tell what sort of transactions you're contemplating.


    • #3
      I'll give a simple transaction.
      i have CC debit of $60,000
      My spouse and I have joint debt of $7000

      We had hail damage on the house, we got a check for $11,000 dollars. The check is in both of our names.
      Can we use the check to pay off the Joint Credit card, and have the left over money in Wifes bank account.
      The mortgage is in my name and my name only.

      We are trying to have only myself file, and not the wife.

      Second transaction- If my wife does not have to file.

      We get $10,000 a year from the State. For reimbursement for certain "medical expenses'for our child.
      She gets supplements(approved by a doctor and the state) they cost $600 a month. (this is only 1 type of expense)

      Can I pay for them, draining any exces money I have. Or pay for them instead of paying my CC bill.
      and since the money is given to my wife by the State and placed into her account. ,

      What wolud be the status of this money in a BK filing? Keeping in mind that we dont want my wife to file.

      Would that type of transaction be allowed to stand?
      Last edited by harris; 06-13-2011, 06:49 PM. Reason: add more


      • #4
        Simple transaction #1
        If you're already planning a bankruptcy for yourself, this could be problematic no matter when you meet with your attorney. You're preferentially paying a creditor, knowing that the other creditor(s) will be screwed. The trustee could pull the money from the joint card and redistribute it. That's if, of course, your insurance company doesn't pitch a fit about an $11k payment that may not have been applied as intended.

        Simple transaction #2
        Reasonably spending-down cash prior to a BK is part of some peoples' pre-bankruptcy planning. Pre-paying for items is usually limited to a couple of months in advance. Putting costs on a credit card when you know you're going to claim bankruptcy is fraudulent... especially in this case when you're receiving cash specifically for those expenses.

        It may sound harsh, but your simple transactions could really get you into some hot water. It's unlikely anyone here could/would advise you on the timing of your spending decisions and your attorney visit because the forum isn't set up to help people navigate fraudulent activity. Besides recommending avoiding it, of course. Be honest, stay within the law, and know that no detail is too small to most trustees. Best of luck to you.
        OK - from now on it's not a "Bankruptcy." It's a "Weight Loss Program." I'm in. Sign me up.


        • #5
          I agree with Peeps. You need to be very, very careful of everything you do in the months leading up to filing for bankruptcy or it will come back and bite you in the butt.

          Why wouldn't you just have your wife file too so you can get rid of the credit card debt in one fell swoop?
          ~~ Filed Over Median Income Chapter 7: 12/17/2010 ~~ 341 Held: 1/12/2011 ~~ Discharged: 03/16/2011 ~~
          Not an attorney - just an opinionated woman.


          • #6
            1) No I'm not planning on putting costs on a Credit card. It would be away for me to spend down any cash I had. That could not be exempted.

            2) According to the Insurance adjuster you dont need to do anything, now If you want to get the full settlement amount, then Yes We would need to do the repairs.

            We might put the wife on if it comes to that, Aka if were not allowed to do the planning I mentioned above,
            It might be best for her to be on ,. to the double exemption.


            • #7
              I think you're being a bit shortsighted here.
              You are trying to to discharge $60K worth of debt-don't play games over $7500.
              I'd get that house repaired. Use the check for that purpose. You don't want further damage down the road. Plus, if you ever sell the house the seller is gonna insist on the roof being repaired.
              There are a lot of ways to drain excess cash. Starting by stop using the cc's and using cash for daily living expenses. Make sure you and you family get any needed dental work done. New glasses/contacts. Make sure you have reliable transportation. Look at your house. Any repairs/maintenace you need to do that insurance doesn't cover {painting, gutters, cracks in the driveway/sidewalk}.
              Just start looking around and thinking about all the things you need. You'll burn through money pretty fast.


              • #8
                If I decide to go ther BK route. I would like to get a complete fresh start.
                So I would not keep the house, and we would in all probability leave the State. All medical expenses are already covered by the government health plans.
                i just want to make sure I do everything on the Up and Up, but at the same time to reduce the harships for the rest of the family.
                But lets talk for example Car repair. I Can take say $2,000 and repair the car. (it needs a new air conditionar, and a new front bumper and new tires)
                That would be okay.

                But Let say we Put it on the joint Credit card , and then the next day send in a check for $2000. That would not be okay?

                Also the damage to the house was the siding. The roof is also Damaged but not because of the hail. It would cost according to one estimate $20,000 to repair correctly. And that is not covered by insurance.

                Right now based on the feedback. We are doing nothing with the check. Not cashing it , not paying off the CC, not fixing the house . As i think This might be a question for a BK attorney.
                Last edited by harris; 06-14-2011, 05:37 PM.


                • #9
                  Originally posted by harris View Post
                  We had hail damage on the house, we got a check for $11,000 dollars. The check is in both of our names. Can we use the check to pay off the Joint Credit card, and have the left over money in Wifes bank account. We get $10,000 a year from the State. Can I pay for them, draining any exces money I have. Or pay for them instead of paying my CC bill. What wolud be the status of this money in a BK filing?

                  I believe these are things that you can discuss with an experienced bk attorney without eliminating your options. If you were to see a bk attorney, then charge up a lot of new debt, then file bk, your creditor would be able to use the fact that you had already consulted a bk attorney to establish that you had no intention of repaying the debt thereby making it nondischargeable. But you're not talking about acquiring new debt. These seem like asset protection questions.

                  Sometimes it's possible to keep insurance proceeds without spending it on the necessary repair, but sometimes (not always) it's insurance fraud. I don't know where that line is when it comes to your policy & circumstance.

                  We had some casualty gain on a rental property once upon a time. According to the IRS we didn't even need to use the same "money" to make the repairs/rebuild. It was right in their publication that it's perfectly legit to cash the check, spend it, defer gain for around two years and then rebuild using money from another source. In one pocket, out the other. Of course you should be able to exclude any taxable gain (if you are free to spend the money without doing the repair) because it's your principal residence. Our casualty was with a rental. In our case, we were free to spend the proceeds however we wanted. The insurance payout covered our loss. So long as we were prepared to pay tax on the gain (against our adjusted basis in the property), we could keep it and spend it. And we did. Not fraud in our case. (edit to add: Not sure what legal recourse your lien-holder would have)

                  If you don't spend the money on the repair, there may be issues with it as "income". You would likely need to list it on your petition (where you list all income over the last two years regardless of source) and then there's also the Means Test. So if it turns out you don't have to spend it on the repair, you'll want to consider how it will impact your filing in other areas.

                  I don't see a problem paying off joint debt unless you do it within 90 days of filing. Within 90 days, it's preferential and the trustee can go to the creditor and recover the money. This has no impact on your discharge but it would put your wife back on the hook.

                  If the insurance payout is in both your names and presuming you're safe to spend it, I believe depositing whatever is left in your wife's sole account after paying off the joint account would cause you problems. I think it would be better to spend it down on allowable expenses.
                  There are two secrets for success in life:
                  1.) Never tell everything you know.


                  • #10
                    Listen to debee; he gives very good advice. His last paragraph is especially important:
                    >If the insurance payout is in both your names and presuming you're safe to spend it, I believe depositing whatever is left in your wife's sole account after paying off the joint account would cause you problems. I think it would be better to spend it down on allowable expenses. <

                    If you give away (or sell for less than market value) any of your assets before a bankruptcy, it could be considered bankruptcy fraud which is a felony. There are also lesser possibilities but that one should frighten you enough to get you to stop thinking about it.


                    • #11
                      A friend gave me another idea, while i was speaking too them.
                      Dont pay the mortgage. I might be able to get away with out paying it for a year ( He has a friend who has not paid for 2 years) .
                      Then apply the mortgage money to the credit card. The only thing is. We need to be able to stay in the house for 1 more year.
                      After that we are going to be moving. If this works the way people tell me it could I should be able to A) pay off the debt within 2-3 years.
                      But thats the question Am I missing something with this Idea?


                      • #12
                        Originally posted by harris View Post
                        Am I missing something with this Idea?
                        The only thing I can think of right now is "deficiency" judgment.

                        Although Minnesota is normally non-recourse, there are situations (such as a second mortgage or HELOC) that allow for deficiency judgments. If your primary lender pursues a judicial foreclosure (rare, but allowed) then you end up back on the hook. So, if it were me I would look into the mortgage issue before deciding how to proceed.

                        If you're going to end up having to declare bk down the road (because of a deficiency), you might save yourself some stress and trouble by just getting it over with. "Wish I did it sooner" seems to be a popular refrain among those who have filed bk.

                        Look into the exemptions for your state and see how much cash you can exempt. I know you have the option of using the federal exemptions which allow for a large cash exemption (around 11K). Save and use the money for your future. Let the credit card debt crash and burn.

                        If your situation is such that you don't expect the lender to pursue deficiency, then there are ways to stall foreclosure.
                        There are two secrets for success in life:
                        1.) Never tell everything you know.


                        • #13
                          "According to Realty Trac, a leading housing industry research firm, nearly 2 million foreclosures will occur in 2011 and likely will continue well into 2012. With so many facing foreclosures, distressed homeowners will likely be faced with the decision to just walk away from the property, especially given the fact that a substantial number of foreclosures are caused by loss of income due to unemployment. Under such circumstances homeowners cannot even qualify for a Home Affordable Modification Program (HAMP) to avoid foreclosure.

                          In almost every foreclosure scenario the home is in a position known as being “under water”. This means the home’s value is less than what is owed on the property. Foreclosing on such a property leaves a difference between what the mortgage loan balance is and what the foreclosing property actually sold for. This difference is known as a deficiency. When there is a deficiency a lender has the option to go after the homeowner for the amount of the deficiency by filing a claim in court. If successful, the judgment rendered by a court in favor of the lender is called a “deficiency judgment”.

                          Once obtained, the lender can seek to enforce the judgment by attaching any asset of the homeowner that is not exempt by law. Therefore bank accounts, personal property, accounts receivable and the like can be taken by the lender. In addition, the lender can file a copy of the judgment with the county recorders office within the county where the homeowner resides and the deficiency judgment will act as a cloud or bad record against the homeowner so long as it remains on the county records. This could hinder the ability to purchase another property or transfer any other property that the homeowner might otherwise own. It could also affect the homeowner’s ability to receive property free and clear as a gift or inheritance.

                          When involved in a foreclosure, homeowners are not without defenses to a deficiency judgment and armed with proper knowledge need not fear a deficiency judgment and can in fact defeat such a judgment. Here are six defenses that can be deployed against a deficiency judgment.

                          1. The Mortgage Forgiveness Debt Relief Act:

                          Under this law, enacted in 2007 and now extended to 2012, homeowners who lose their principle homes (the house they actually live in) to foreclosure and thereafter face a deficiency cannot be held liable for any deficiency judgment. The amount is automatically written off. The homeowner cannot be held responsible for such debt. Any lender seeking to enforce a deficiency judgment in such circumstances would be acting illegally and the homeowner would not only have a complete defense, but a right to counter sue the lender for abuse of process or other appropriate claims.

                          2. Properties Foreclosed On That Are Not A Principle Residence:

                          Many foreclosures taking place are on homes that are not the principle residence of the homeowner. The Mortgage Forgiveness Debt Relief Act would not protect against a deficiency judgment in this case. A homeowner should negotiate with the lender under such circumstances and seek a written agreement that the lender will not seek a deficiency judgment in return for the homeowner just walking away and giving up any legal right the homeowner may otherwise have to file a claim against the lender. In the current state of affairs lenders are facing numerous claims of fraud, failure to follow foreclosure regulations and other bad faith claims. Such claims have value and can be used to negotiate with the lender to not seek a deficiency judgment.

                          3. IRS Tax Collection Defense:

                          Rather than seek a deficiency judgment a lender may simply write the deficiency off its books and then issue a 1099c to the homeowner showing the amount of the deficiency. Under IRS rules this reporting is the same as income to the homeowner and taxes must be paid on the amount. This is devastating to a homeowner who has already lost the property through foreclosure because payments couldn’t be made and now must face a tax debt. A defense against such a claim by the IRS is a claim that the homeowner is “insolvent” meaning there is no money from any source that can be used to pay such a tax. The law provides protection under this insolvency exclusion. Homeowners facing attempts from the IRS for collection purposes should seek advice from a competent CPA or Tax Attorney.

                          4. Home Affordable Foreclosure Alternative Program (HAFA):

                          The federal government has a program whereby it encourages homeowners to apply for and seek a short sale of property in foreclosure rather than go through the foreclosure process. The amount of any deficiency is what constitutes the short sale (selling short of what is actually owed). Once a homeowner makes an application under HAFA the new rules taking place on February 1, 2011 require the lender, once application is made by the homeowner, to stop the foreclosure process and respond with an approval of the short sale within 30 days from the application or to make a counteroffer on the short sale of the home within that same period of time. Homeowners using HAFA can be protected against any deficiency judgment and should review the requirement of the program as one defensive option when facing foreclosure.

                          5. State Regulations and Rules Governing Deficiency Judgments:

                          Some states, in efforts to protect its homeowners facing foreclosure, have passed new laws that cover not only principle places of residence but investment properties also. Homeowners living in those states are relieved from liability for any deficiency judgment on first trust deeds on properties foreclosed on. California is one such state that has recently enacted such a law under SB 931. Homeowners should check their state foreclosure laws to verify whether similar protection exists in their state.

                          6. Bankruptcy! The Death Blow To A Deficiency Judgment:

                          If all else fails, a homeowner facing a deficiency judgment can file a petition in bankruptcy under Chapter 7 of the Bankruptcy Rules. In a Chapter 7 bankruptcy all unsecured debt is wiped out, with very few exceptions. A deficiency judgment becomes personal and against the homeowner and is no more than an unsecured debt. Therefore, it can be extinguished in bankruptcy. Often time lenders assign or sell deficiency judgments to debt collectors. A bankruptcy would wipe these claims out too.

                          Homeowners facing deficiency judgments or the possibility should keep these six defenses in mind. Using any of these defenses however should be discussed with an experienced attorney before attempting to implement them."
                          8/4/2008 MAKE SURE AND VISIT Tobee's Blogs! and all are welcome to bk forum's Florida State Questions and Answers on BK


                          • #14
                            I think Realty Trac has item number 1 wrong.
                            Here's a link to the actual bill and it deals with the tax issues associated with a foreclosure. Nowhere could I see that it prohibits a lender from seeking a deficiency judgment should state law allow it.



                            • #15
                              Originally posted by keepmine View Post
                              I think Realty Trac has item number 1 wrong.
                              Here's a link to the actual bill and it deals with the tax issues associated with a foreclosure. Nowhere could I see that it prohibits a lender from seeking a deficiency judgment should state law allow it.

                              they may, and i do think it varies from state to state. you have to prove, one would likely think filing bk would qualify you under those circumstances...but who really knows until it happens. after all, who is it they are going to go after, if one has nothing.

                              we owned property in a deficiency state, and although, it's been over 3 years and they still haven't foreclosed, we are not in the least worried if they present us with a 1099C or attempt to bill us for the deficiency, since we can prove insolvency. (in our case we also had or have the bank can go after the FHA for any deficiency). so there are a few more factors involved than what is actually written in the body of the bill itself.

                              also this is a publication by the help explain how one go about reporting the deficiency, if one is faced with a balance:
                              Last edited by tobee43; 06-19-2011, 08:58 AM.
                              8/4/2008 MAKE SURE AND VISIT Tobee's Blogs! and all are welcome to bk forum's Florida State Questions and Answers on BK


                              Unconfigured Ad Widget