Dad in financial trouble

[Joejoe00]

That is true, but that is also not the concern of the creditor. I am sympathetic, I really am. But when you're looking at this (or any) situation, you have to look at it from both sides so that you are better prepared for what is (or may be) to come.

Bad thing is if your in a 20,000 hole at age 80, your not going to dig urself out.

 

[despritfreya]

If your 80 year old father has no assets and his only debt is those cards, then I don't think bankruptcy is even needed. As mentioned, he's going to get hounding calls and letters, but those can be ignored. He may get sued, but his money is protected from garnishment/levy, so long as the proper response is made to any attempted action.

This is the correct response.

If you were to come into my office (with or without your dad) I would be telling you (your dad) to ignore the collection calls. Creditors (other than the IRS) cannot garnish SS.

I trust your dad's SS is placed into a segregated bank account where NOTHING but SS is deposited. If so, don't worry about it. If not, have him get a separate account set up.

Des.

 

[Joejoe00]

Dad gave me money before filing bankruptcy
What is the name of your state (only U.S. law)? Pennsylvania
Hi, my dad is having money problems due to credit cards and is thinkinabout filing for bankruptcy. He gave me a gift of money approx 40,000 a year ago from a workers comp settlement to help us pay our mortgage off. My question is: what is the waiting period he should wait before filing bankruptcy to protect me from creditors coming after the money he gave me? I read that creditors come after a family me ber at recieved a gift or that was an inside creditor. Thnks

 

[Zigner]

Dad gave me money before filing bankruptcy
What is the name of your state (only U.S. law)? Pennsylvania
Hi, my dad is having money problems due to credit cards and is thinkinabout filing for bankruptcy. He gave me a gift of money approx 40,000 a year ago from a workers comp settlement to help us pay our mortgage off. My question is: what is the waiting period he should wait before filing bankruptcy to protect me from creditors coming after the money he gave me? I read that creditors come after a family me ber at recieved a gift or that was an inside creditor. Thnks

You have been answered by a bankruptcy attorney - bankruptcy is probably not the right option for your dad.

 

[HRZ]

I agree as a layman, hard to collect a dime from dad if he does nothing but tune out collectors .

 

[Zigner]

I have to admit that I find it astonishing that your dad had $40k to just rain down on you a year ago, but can't scrape together enough money to pay his credit card bills.

 

[Joejoe00]

So you intend to ignore the most recent advice given in this thread and have your father file bankruptcy anyway?

????? He didnt file

 

[Zigner]

????? He didnt file

Nobody said he did.

 

[HRZ]

I have no doubt somebody could be a terrible money manager and make unwise transfers without having intent to commit fraud ...BUT I think it's most unwise to open up any such Pandora' Box ..the lookback window in bankruptcy can be up to 6 years ..and way beyond me.... DItto issues of fraudulent transfer .and if Dad transferred gifts ahead of going into the red thats yet again different .....not smart to take the lid off the box.

COllection options are limited in PA ?..but don't have funds in accounts is even better .

I too have questions about Dad raining down 40 K on a child as an attempt to defraud creditors ...but I have some older friends who would do and some did just that..make gifts to family ...and go broke ..as terrible money managers ..and some died in the red. ..

 

[Joejoe00]

I have no doubt somebody could be a terrible money manager and make unwise transfers without having intent to commit fraud ...BUT I think it's most unwise to open up any such Pandora' Box ..the lookback window in bankruptcy can be up to 6 years ..and way beyond me.... DItto issues of fraudulent transfer .and if Dad transferred gifts ahead of going into the red thats yet again different .....not smart to take the lid off the box.

COllection options are limited in PA ?..but don't have funds in accounts is even better .

I too have questions about Dad raining down 40 K on a child as an attempt to defraud creditors ...but I have some older friends who would do and some did just that..make gifts to family ...and go broke ..as terrible money managers ..and some died in the red. ..

Who said he was trying to defraud??? He gave me it over a year ago and then got in financial problems afterwards

 

[despritfreya]

OP,

Forgetting that your dad has no reason to file bk as he has no assets per your prior posts, here is what will happen if he does file. . .

1. The gift of $40,000.00 must be listed on question 13 of the Statement of Financial Affairs which asks. . . “Within 2 years before you filed for bankruptcy, did you give any gifts with a total value of more than $600 per person?”.

If he fails to disclose it on question 13 then he better disclose it on question 18 which asks, “Within 2 years before you filed for bankruptcy, did you sell, trade, or otherwise transfer any property to anyone, other than property transferred in the ordinary course of your business or financial affairs? Include both outright transfers and transfers made as security (such as the granting of a security interest or mortgage on your property). Do not include gifts and transfers that you have already listed on this statement.”

2. Since it was a gift/transfer his Trustee will have the authority to attempt to recover it under 11 USC 548.

3. The trustee is not going to seek recovery from your father. He/she is going to seek recovery from the recipient of the gift/transfer - that’s YOU.

4. You might be able to defend the litigation you will be involved with by arguing that the funds were from workers compensation which was exempt under PA law. You could further argue that since they were exempt your dad could transfer/gift the funds as he pleased without consequence. Unfortunately, I think you would lose that argument. But, some attorney would be willing to charge you good money to make the argument.

So, do you still think your dad should file bk? Leave it alone. If, as you say, he has nothing but SS and now with this added issue, I do not see why he would ever think filing bk was a good idea.

Des.