Cash Advance-

[LdiJ]

Look back period? I don't know what you are referring to there and, depending on what it is, how it applies here.

In a bankruptcy, there is a look back period where the trustee has the right to determine if some creditors got preferential treatment prior to the filing of the bankruptcy and the trustee has the right to demand back any money, from the creditor, that was paid out preferentially.

It mostly has to do with who gets first crack at the assets in a bankruptcy. There are tiers of creditors who get first crack at assets. If some bottom level creditor was such a squeaky wheel that they managed to get their money out either before the bankruptcy was filed or during the period where it was just filed the bankruptcy court can demand the money back to go towards the first tier creditors.

A payday loan company is going to be last tier.

 

[justalayman]

A check is nothing other than a promise to pay, which, unless restricted, is a negotiable instrument. (A rose by any other name, Justy).

Also, if you will read the applicable subsection of Section 362 you will note that the word "check" does not appear. It refers without qualification to a "Negotiable Instrument"!

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Now can you lend any insight as to whether there is or is not a conflict in the Code with respect to the prohibitions contained in subsections (a)(3) and (a)(6) with that of subsection (b)(11)?

There must have been some specific design of Congress in adding that subsection, so what was the purpose other than to regard the negotiation, or attempt to negotiate of such an instrument as not being an act by the holder/creditor to "recover a claim".

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We are not given to know the proximity of the debtor's contracting for and receiving the cash advance and the filing of his petition for debtor's relief. But if it was done in contemplation of filing, the OP is going to have some problems trying to rinse that claim.

A suspicious mind might conjecture that the advance was used to pay his lawyer and the clerk for the filing fees. Not me of course.

The instrument was not negotiable upon delivery. That is the point of a "payday" loan.

Additionally, LA specifically precludes a lender from treating it as a bad check; they cannot threaten to prosecute nor can they refer it for prosecution. How can they allow this if this would be a bad check?

§3578.6. Prohibited acts
A. A licensee shall not:
(5) Threaten any customer with prosecution or refer for prosecution any check accepted as payment of a deferred presentment transaction and returned by the lender's depository institution for reason of insufficient funds.

but as you said: a check is a negotiable instrument IF delivered without restriction. A payday loan is what? An agreement the check is not negotiable until some time in the future ergo; it is not a negotiable instrument an as such, not a check.

 

[tranquility]

There is also another possible issue here and one that could affect whether the creditor's claim for the cash advance is dischargeable.

We are not given to know the proximity of the debtor's contracting for and receiving the cash advance and the filing of his petition for debtor's relief. But if it was done in contemplation of filing, the OP is going to have some problems trying to rinse that claim.

Um...two weeks?

I accept there could be an issue over re-committing to a debt. But, without more facts, I'd say the debt is in the look back period.

 

[TimStudiesLaw]

yep. Your point?

I said generally stale. I didn't say a bank would refuse to cash it but quite often they will. I know of several offhand that will.

My point was it's not really stale if a bank can honor it.

 

[justalayman]

My point was it's not really stale if a bank can honor it.

its stale, not spoiled.


Up to 6 months a bank must cash the check. After 6 months it is at the discretion of the bank.