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  1. #1
    Join Date
    Jul 2018
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    2,745

    Default Re: Pension Loan

    Quote Quoting formyboys
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    I am considering bankruptcy. I've read that sometimes the trustee can and will sue a family member if they were paid back. Is there anyway around this.
    Depends on the relevant facts and circumstances.


    Quote Quoting formyboys
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    I paid a family member ($20,000) back using a pension loan about 6 months ago which I will continue to pay even through the bankruptcy if approved?
    Despite your use of a question mark, this sentence is not a question. If you intended a question, I cannot discern what you intended to ask. For what did you pay this family member back? Can you be any more precise than "about 6 months ago"? Also, "family member" could mean a lot of things, so the specific relationship may matter.


    Quote Quoting formyboys
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    If it's a loan that can't be touched in bankruptcy, how can they sue a person for it?
    Huh? I have no idea what you mean by "loan that can't be touched." No one wants to "touch" a loan. If you made a preference payment (and it's not clear that you did), then the bankruptcy trustee may be able to seek to recover that for the benefit of the bankruptcy estate. You'll still have the loan obligation, which won't be impacted whatsoever (I'm not sure whether your obligation to repay a "pension loan" will or won't be discharged in the bankruptcy).

    Obviously, this is something you should discuss with your bankruptcy attorney.

    Quote Quoting despritfreya
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    Anything paid within 1 year prior to filing can and will be recovered by the Trustee.
    I disagree with the "and will" part of this. Just because the trustee can do it doesn't mean he/she necessarily will. Bankruptcy trustees ignore low-hanging fruit all the time.

  2. #2
    Join Date
    Sep 2010
    Posts
    478

    Default Re: Pension Loan

    Quote Quoting pg1067
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    I disagree with the "and will" part of this. Just because the trustee can do it doesn't mean he/she necessarily will. Bankruptcy trustees ignore low-hanging fruit all the time.
    Been doing this for over 30 years. I have never seen a trustee "ignore low-hanging fruit" when that fruit amounts to $20k but, great minds can differ.

    Des.

  3. #3
    Join Date
    Jul 2018
    Posts
    2,745

    Default Re: Pension Loan

    Quote Quoting despritfreya
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    Been doing this for over 30 years. I have never seen a trustee "ignore low-hanging fruit" when that fruit amounts to $20k but, great minds can differ.
    Happened to me earlier this year, and I've seen it happen multiple times over the past 20+ years. It's possible that the trustees where I live/practice are more lax than those where you live/practice.

  4. #4
    Join Date
    Sep 2010
    Posts
    478

    Default Re: Pension Loan

    Quote Quoting pg1067
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    Happened to me earlier this year, and I've seen it happen multiple times over the past 20+ years. It's possible that the trustees where I live/practice are more lax than those where you live/practice.
    That's pretty sad. Wonder how many of those trustees have contacted their bonding company due to the breach of their fiduciary duty to creditors.

    Des.

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