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WALLSTREETESQ
WALLSTREETESQ, Attorney
Category: Bankruptcy Law
Satisfied Customers: 16049
Experience:  14 years exp., CH 7 AND 13 Bankruptcy cases, AFL-CIO UNION PLUS, UFT NYSID AND ALL MAJOR UNIONS
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another Bankruptcy question, I am getting ready to file Ch

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another Bankruptcy question, I am getting ready to file Ch 7, and was going to put in my car and its loan because I cannot afford to keep it with its payments, but I have found someone that wants my car and will pay me 1500 or so over the loan balance, which I plan to use to buy an older sedan so that we can have a family car. My 18 year old has an old car, maybe worth 800 or so, that is still in my name and paid off. My question is, I have filled out the preliminary papers online, and sent them to my lawyer, but we have not gotten together yet to complete them and file them. He is out of pocket for a couple of days, and this situation with my car has come up and I need to know whether I can sell my car and take it off the bankruptcy and buy the older one so close to filing? Dont want to do anything wrong, but I really need something to drive and this opportunity came up this weekend and I am needing to know if it is ok to do this with the cars, since I have not officially filed yet, but was going to this week. Can you help me? I live in TN. Thanks, Jan
Submitted: 3 years ago.
Category: Bankruptcy Law
Expert:  WALLSTREETESQ replied 3 years ago.
Hello I am a licensed attorney here to help you with your question, please review my response and do not hesitate to ask for clarificati on.

You have two options, one is to file your bankruptcy now, and reafirm the car loan payments, since the car is not included in the bankruptcy you can later sell it and pay off the debt and keep the money.

The second option is to sell the vehicle now and purchase another one, and when you file your bankruptcy advise the court of the transaction. Also, since TN has a $4000 personal property exemption from collections, you could keep the $1500 anyway.

26-2-103 - $4,000 of any personal property.
Customer: replied 3 years ago.
Thanks, XXXXX XXXXX the personal property exemption, Would that include our furniture, clothes, misc, and my sons car(about $700) and the new(old) car, as well as the 1500 that I sold the car for that I used to buy the new(old) car? Or would that be counting the 1500 twice?
Is there a way to transfer my sons car to his name, since he has just turned 18 and it is his car not mine?
Expert:  WALLSTREETESQ replied 3 years ago.
the personal property exemption is for all the property the $1500 you received from the sale would be exempt as it would be under the price, it would be counted once. The car title can be changed to your sons name through the department of motor vehicles, however you would still have to list the car as your property when you file, as the transfer was done less than 6 months from the filing. The new car can be put into his name, but i would still list it and put your son as the owner.
Customer: replied 3 years ago.
Ok, just curious though, if I put the 1500 straight back into the new car, and it is in my name, would the value of the car count as an asset or the 1500 I received for the sale of the other car count? If I put that I received the 1500 from the other car as cash, I know I should put that in, but then if I list the value of the new car as 1500 also, that seems like it would get counted twice? And with my furniture and my sons car that would throw me over the 4000. But if I show that the 1500 cash went to buying the 1500 new car, I assume that that would count it once?
Expert:  WALLSTREETESQ replied 3 years ago.
I see your issue, when you file a bankruptcy the $1500 will be counted once because they would be listed is different scheduales.

For instance when you list your property you would only list the new car for $1500.00,
and your other property, in another schedulae you would list any transfers or payments to creditors within the last 6 months, that is where you would state you paid off the creditor and bought the new car for $1500.00

You would not list the value of the prior vehicle in your property so it will be counted once.

I would reaffirm the first car in your filing, and sell the car after the 341 meeting, this avoids all issues.
Customer: replied 3 years ago.
I was planning on waiting, but the offer to buy my car would not still be around if I wait a month or more, so I am kind of pressured to go ahead and sell it, also the car I was considering buying wont be around either. which I could find something else, but without the offer to buy my car for over its loan balance, I could end up being stuck with it and its payments, just to have a vehicle to drive. It is kind of a one time deal to sell it for this amount. See my predicament? Sounds like it is workable to go ahead and do the sell and buy thing now, just trickier on the paperwork. Hopefully, we will be able to get this to work out well. Any other suggestions? Thanks
Expert:  WALLSTREETESQ replied 3 years ago.
then you should sell it, and purchase the new car, try to delay the bankruptcy filing then by a few weeks or months. Also, lower the value of your personal items, as they have to be what the items would get now, which is much lower than what you paid for them.
Customer: replied 3 years ago.
Actually, I dont know if I can delay filing, due to a foreclosure. So do you think it is workable at all to do the sell/buy and go ahead and file? otherwise I may have to just let the car go.
Expert:  WALLSTREETESQ replied 3 years ago.
i would file and purchase the car, the question you will have is whether the property will be exempt, you could lower the value of your furnishings to come to under 4000.
Customer: replied 3 years ago.
so the values are what things would sell for as of now? with my sons car and our furniture, which is all old, and misc, even with the new cars value of 1500 or so, we should be around the 4000 area. So I can set the value of what we own? Like I was selling things today?
Expert:  WALLSTREETESQ replied 3 years ago.
yes, for example a sofa bought three years ago for $1000 can be valued now for $100 as if sold now you would not get 20-30% of the value.
WALLSTREETESQ, Attorney
Category: Bankruptcy Law
Satisfied Customers: 16049
Experience: 14 years exp., CH 7 AND 13 Bankruptcy cases, AFL-CIO UNION PLUS, UFT NYSID AND ALL MAJOR UNIONS
WALLSTREETESQ and 4 other Bankruptcy Law Specialists are ready to help you

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