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kicklaw40, Attorney
Category: Bankruptcy Law
Satisfied Customers: 21
Experience:  I have been a bankruptcy attorney since 1998 and have handled hundreds of bankruptcy cases successfully.
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I am filing a ch.7 BK and the trustee is asking me for more

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I am filing a ch.7 BK and the trustee is asking me for more information about a joint account that is my mother's but she has added her three sons (me included) as signers on the account. I was added 4/2008 on the account. She has had the account since 1982. On 12/17/2007 she received an $86,000 inheritance and has received her Social Security deposited into the account for the past 30 years. In 2011 I had deposited about $20K in her account and then took all of it except for about $4800 of it out. The reason why is basically because my loan mod/short sale 'expert' told me to put the money I wasn't paying towards my mortgage in an another account so my bank, who was also my lender, would not see it. I asked him if this joint account would be ok and he said yes. Now it seems to have become a problem with my BK. I have printed detailed statements from both accounts showing the come and go of money. My main concern is that somehow money that is my mother's would be confiscated by the trustee somehow. My mother is 85 and could seriously have a heart attack if something like that happened. What does BK law say about a situation like this. Obviously I was not thinking of filing BK when I was moving this money around. Ultimately we lost the home to foreclosure 1/20/12 because we could not get a short sale offer that the bank would accept.
Many states, I believe including California, have provisions in their code that says essentially that "a joint account belongs, during the lifetime of all parties, to the parties in proportion to the net contributions by each to the Sums on deposit, unless there is clear and convincing evidence of a different intent." In other words, the only money that is yours is money you have actually put into the account.

Typically in this type of situation, you will need to produce evidence about where the money that was deposited came from. The Trustee may want an affidavit from your mother regarding her contributions to the account and the inheritance, and any other account owners who may have put money in there. You will need to show proof of the money you put in and the withdrawals you made to show how much of what remains in actually yours.

If the original petition did not disclose this account, I would also amend Schedule B to list the account and list that it is a joint account and list the value as whatever your portion of the money is ($4,800).

I hope this is helpful!
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