Bankruptcy
: Florida Bankruptcy LawAre Investments Financed With Consumer Credit Cards Non-Consumer Debt For Means Test Qualification?
By Jonathan Alper (index)
We are preparing a bankruptcy for a client whose household income is over $100,000 per year. He does not even come close to passing the means test. The client states that most of credit card debt is for cash advances which were invested in the stock market. He also took a second mortgage on the house and invested most of the money in the stock market. The recent stock market crash is causing him to default on the credit cards. The client insists that his credit card advances invested in the market constitutes "non consumer debt" and because most of his overall debt is "non-consumer" debt he is exempt from the means test.
The client is correct that people whose debts are primarily not consumer debt do not have to pass the means test and all other things being equal can file Chapter 7 bankruptcy regardless of whether they otherwise pass the means test analysis. The issue is whether a cash advance by a consumer on a personal credit card is "non-consumer debt" because the consumer invests the money in the stock market or another type of businss venture for profit.
I am not aware of any cases on this issue; nor, have I ever researched the issue. I did have the chance to speak with an attorney for the U.S. Trustee about another bankruptcy case, and in the course of the conversation I raised the stock market/credit card issue. The attorney stated that the U.S. Trustee will treat stock market investments financed on credit cards as non-consumer debt for means test purposes if the debtor can clearly trace credit card advances to investments in the market or another business venture.
posted by Jonathan Alper, bankruptcy and asset protection attorney, Orlando, Florida
Full post as published by Florida Bankruptcy Law on October 15, 2008 (boomark / email).
Debt collectors figure out how to close the circle
Like a sort of perpetual-motion machine for debt—a perpetual-debt machine, rather—Oregon debt collection agency Genesis Financial Solutions has started issuing credit cards to consumers, with the balance equal to the debt the consumer allegedly owes...
Responsible Lending Practices: Consumer Credit Cards
The Ministerial Council on Consumer Affairs has released a consultation Regulatory Impact Statement on Responsible Lending Practices in Relation to Consumer Credit Cards (pdf)...
Revolving Credit Rollercoaster
The Federal Reserve tracks outstanding revolving consumer debt in its statistical release G...
The Future of Consumer Credit...Today
We need to look at the net picture when we evaluate whether the terms of consumer credit are improving or worsening, but at the same time we need to recognize that within that net picture there may be some winners and some losers...
Consumer Credit Explodes in June, Further Proving Consumer Claims Unfounded
Despite what a recent Javelin Strategy & Research online survey suggested about consumer credit use being down in the midst of the nation's current economic struggles, recently-released Federal Reserve numbers for the month of June reveal quite the opposite about consumer credit.
Blawg of the Day -- California Consumer Finance Litigation
From the San Francisco firm of O'Rielly & Roche comes the California Consumer Finance Litigation is providing current and timely information about developments, trends and analysis in consumer finance...
Truth In Lending Act
Consumer Loans and Consumer Credit Protection Act
Collection Agencies and Creditors
How to deal and stop the harassment
Bankruptcy Law
A complete prime (pre-2005)
The Mortgage Forgiveness Debt Relief Act
Phantom Income Relief on Debt Cancellation
Child Support
Disputing Paternity
Language Requirements for Citizenship
Naturalization without an English language test
My fiance's check is DD into a local credit union. Bank seems to have a pattern of "invisibly holding" charges from the debit card until just HOURS before his DD is processed (and this is after hours, of course). Over th
Have your fiance take the information you've collected and go into the bank...
What role does financial means determine which parent gains custody?
was(am) a single male that gained custody of my daughter when she was three. Thi...
My father died and left my mother $200,000 (life insurance) My Mother died 2 years later leaving my sister and I with both about $75,000 each. (including house/vehicles/belongings which I never got). We were supposed to
File a police report. Two police reports, one for you and one for your sister. G...
Must I refinance my house aftering taking full ownership after a divorce via a quit claim?
When financing there are at least two documents...the mortgage and the note. The...
Should I return a phone call from a collection agency that doesn't name their client in the message?
In the county of the state where I live in the US, I am able to go to the websit...
Cash4Gold Hit with Consumer Fraud Class Action
Cash4Gold Hit with Consumer Fraud Class Action
CVS
Consumer Products Sold Past Their Expirey Dates
Mexican Vanilla Containing Coumarin
, FDA Issues Consumer Update
Ford Focus
Consumer Class Action Settles for Cash Refunds
AmeriGas, Blue Rhino
Face Consumer Class Action
Germantown Primary Care Associates, P.C.
Unlawfully collected fees refunded in Consumer Protection Act violation suit.
#1 Online Legal Resource
On 08-28 at 21:13PM
Ten months later, Fed must reveal names of emergency lending recipients #FOIA
On 08-25 at 19:02PM
Squeaky Fromme, would-be Ford assassin and Manson devotee, released from prison
On 08-14 at 15:19PM
Likely unintended consequence of cash-for-clunkers stimulus is dampening of 2010 spending
On 08-14 at 14:34PM
Palm seeks to halt Palm Pre Android theme on copyright and trademark ground
On 08-12 at 17:30PM
Congressional investigation demonstrates Karl Rove lied about his active role in US attorney's firing
On 08-12 at 16:20PM
Family of New York City swine flu victim to sue city for failure to secure school #nyc #swineflu
On 08-12 at 12:59PM
Real Network's DVD copying software deemed to break DMCA's anti-circumvention provisions
On 08-12 at 12:57PM
Prepaid funeral operators indicted for $100 Million fraud
On 08-12 at 12:53PM
NY Jets join Cincinnati, Dallas, Green Bay, Houston & Seattle #NFL teams offering branded state lottery games
On 08-12 at 12:43PM
My fiance's check is DD into a local credit union. Bank seems to have a pattern of "invisibly holding" charges from the debit card until just HOURS before his DD is processed (and this is after hours, of course). Over th
Have your fiance take the information you've collected and go into the bank...
What role does financial means determine which parent gains custody?
was(am) a single male that gained custody of my daughter when she was three. Thi...
My father died and left my mother $200,000 (life insurance) My Mother died 2 years later leaving my sister and I with both about $75,000 each. (including house/vehicles/belongings which I never got). We were supposed to
File a police report. Two police reports, one for you and one for your sister. G...
Must I refinance my house aftering taking full ownership after a divorce via a quit claim?
When financing there are at least two documents...the mortgage and the note. The...
Should I return a phone call from a collection agency that doesn't name their client in the message?
In the county of the state where I live in the US, I am able to go to the websit...
 |
|
Contact Us | About Us | Celebrity Law Blog |
Our Partners | Disclaimer
| Law Blog Directory
| Law Jobs
| Law Tweets
| Get GoDaddy Hosting
All original material © 1999-2009 by USLaw.com. All other material, including Blog Directory feed content, are © by their respective copyright holders. |