Creditor disputing Debt

[Poorbill]

What is the name of your state? Indiana

I filed Chap 7 in Feb. I have a creditor disputing credit card dept as far back as Sept 07. Can the dispute go beyond 90 days prior to filing? They are challenging a cash transfer I made in Sept 07 that I used to pay another credit card ($10k). In their letter they stated this is classic BR abuse and I knew back then I was going to file so I maxed out my credit card. My lawyer wants $5000 for a retainer on this matter. She doesn't take monopoly money, so I'm on my own. Should I fight this on my own and let the BR judge decide? They have offered me 0% repayment plan for $10K of the $17K I owed them when I filed. All I need to do is sign the reaffirmation papers. What are the consequences if I fight and lose?

 

[bigun]

If you lose, that particular debt won't be discharged and the creditor may due you and garnish your wages, lein your property or do anything else that your state allows as far as collection.
If they are challenging charges made more than 90 days before you filed, they have the burden of proving fraud/abuse.
Some things you may consider are, did the BT net you a lower interest rate and, how long did you make payments before default? When did you first visit a bk lawyer?

 

[great_ideas]

What is the name of your state? Indiana

I filed Chap 7 in Feb. I have a creditor disputing credit card dept as far back as Sept 07. Can the dispute go beyond 90 days prior to filing? They are challenging a cash transfer I made in Sept 07 that I used to pay another credit card ($10k). In their letter they stated this is classic BR abuse and I knew back then I was going to file so I maxed out my credit card. My lawyer wants $5000 for a retainer on this matter. She doesn't take monopoly money, so I'm on my own. Should I fight this on my own and let the BR judge decide? They have offered me 0% repayment plan for $10K of the $17K I owed them when I filed. All I need to do is sign the reaffirmation papers. What are the consequences if I fight and lose?

Creditors can go back 6 months for balance transfers in Indiana. Had you spoken to an attorney about bankruptcy prior to the balance transfer? If so they would have advised you to not use your cards and not to transfer balances. If you would have waited one more month they probably wouldn't have complained.

There was a case where the BR judge found in favor of the consumer and told the creditor that they shouldn't send out low rate balance transfer offers if they don't want people to use them. (Sorry, I can't find the case at this moment...)

Google bankruptcy fraud, and you will see all of the websites that list the do's and don'ts. Your attorney should have waited to file, but even then if you suspected that you would be filing you shouldn't have done a transfer.

 

[nrknlknek]

This is tricky stuff. You need legal representation. Might I suggest you go to the state bar association and ask for a referral to a low cost service. 5K seems high but I don't know the particulars. The credit card company apparantly has filed an objection to dischargeability. If they prevail, even if the BK goes through, you will still be liable for this debt. Now, previous posters have indicated that you might have some defenses -- I don't know, perhaps. However, if the debt remains after the BK, presumaly you'll have more money to pay back the creditor, so think about that.

 

[Ladynred]

The big IF in this is whether or not they can actually PROVE fraudulent intent. I wouldn't roll over on this, I'd make them make their case and let a BK judge decide. If you knew you were headed for bankruptcy when you did the BT, and you did it anyway, they *might* have a chance of winning. However, lots of people in financial trouble move balances around in the hopes that they can lower payments and MAYBE keep their head above water. This is also part of the denial stage most people go thru.

If you can show that, at the time of the BT, you had no intention of filing bankruptcy, that you were moving things around to lower interest cards hoping to AVOID BK, then this creditor may not win at all. 5K's awfully steep for an adversary proceeding!