Thanks everyone!
The question about shifting debt was more for my husband as he thought that is something the bankruptcy lawyer would do. Personally, it sounded like a lot of risk and potentially illegal to me. Why take such a risk when my debt is minimal and completely manageable?
As for my childrens college accounts. My parents have offered to take charge of the accounts for a time. I know that I need to do something with this money such as invest, place in an appropriate fund etc etc. I am completely clueless when it comes to finances beyond managing bills so pardon me trying to communicate this with my lack of knowledge. My question is, if I invest this money in a state college fund or something of the sort, will it be safe? Would it be wiser to just let my parents hold onto the money until after the bankruptcy?
When my husband consults with a bankrupcty attorney, at what point are we "locked" in? Is it once he/she sees our finances or can they advise us on ways to protect the kids finances, our house etc etc before he actually files? He needs to go have a consultation, but I also want to make sure our ducks are in a row as well.
OUR tax return means it’s also his money. That makes it accessible to the trustee. Before doing anything he needs to speak with the bk attorney.I am using our tax return to restart our daughters college account.
do you mean like in illegally hiding money the trustee should have access to? No. Don’t involve your parents in illegal schemes.Would it be wiser to just let my parents hold onto the money until after the bankruptcy?
depending on what finances you are speakingof in particular, he is locked in either 90 days or 1 year prior to filing.When my husband consults with a bankrupcty attorney, at what point are we "locked" in?
He needs to discuss his options with the attorney before he does anything foolish and risks bankruptcy being denied due to fraudulent actions.
If you put the money in the grandparent's name it will just look fishy. Do not go that route. I am not suggesting that you keep dad's name off of their money for the purposes of the bankruptcy (although its better if you do) but more because dad has already shown himself to be untrustworthy by cleaning out one of their accounts.
As for shifting debt, DON'T DO IT!!! It will be considered fraud, his bankruptcy will be denied and he may be prosecuted.
As for your children's college accounts, DON'T TRANSFER THEM. It will also be considered fraud as you are trying to protect the money by putting it under someone else's name...unless you want to wait 2 years before filing for bankruptcy. They ask on the form if you've transferred ANY financial account to someone else, including a relative.
There is no lock in period. The trustees and the creditors have the right to ask you when you first consulted your lawyer to see if there are any illegal activities after that date (like shifting accounts and giving away money).
So, the best thing to do is wait and get your settlement and tax refunds, first. Make sure to put the settlement in an account with ONLY your name because your husband will need to submit 6 months' statements for all the financial accounts.
All the money in all the accounts with your husband's name is fair game. However, depending on your state, kids' college funds may be exempt. I know that your house is exempt - as long as you're current, you can negotiate with the bank to continue payments on it. Good luck!!!