Can I buy a car with cash after 341 but before discharge? 9 Answers as of August 19, 2017

I am filing chapter 7. I have had my meeting of creditors already and there were no questions other than the routine yes/no. No creditors were present or represented. I own one vehicle outright and have another financed, which I am surrendering. I need to replace this car for my wife. I plan to purchase a car with cash, less than $7000 worth to be precise. My concern is that the trustee would be concerned that I use this cash for a vehicle rather than my debt obligations. Am I safe to make this purchase after the meeting, but before I receive my discharge? I know there is a stay in effect on the financed vehicle, but I would prefer to sort all of this out and return the minivan sooner than later. I don't want to buy a car and then have my bankruptcy challenged, and perhaps lose the car. If I have to wait until the discharge I will, but if I can do so safely now, that is preferable to me.

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Janet A. Lawson Bankruptcy Attorney
Janet A. Lawson Bankruptcy Attorney | Janet Lawson
I am afraid to answer this because I have not seen your schedules. It is entirely possible you are missing something here. You should check with a lawyer who can look at your paper work.
Answer Applies to: California
Replied: 8/19/2017
Stephens Gourley & Bywater | David A. Stephens
Yes, as long as the cash was earned after filing the bankruptcy, or exempt from the bankruptcy.
Answer Applies to: Nevada
Replied: 8/17/2017
Patrick W. Currin, Attorney at Law | Patrick Currin
Returning the car is fine, the underlying debt will still be discharged. As long as the funds used to buy a new car were disclosed in the filing and exempt you can buy what you wish.
Answer Applies to: California
Replied: 8/17/2017
OlsenDaines | Rex Daines
As long as you disclosed all of your assets when the case was filed and at your 341(a), then it is fine to buy a car for cash at this time.
Answer Applies to: Oregon
Replied: 8/17/2017
A Fresh Start
A Fresh Start | Dorothy G Bunce
Where did you get the cash? And more important, when did you get the cash? If you got the cash from earnings after the bankruptcy, no problem. If you got the cash from money you declared as exempt, no problem. If you got the cash from your secret hiding place, held before you filed bankruptcy, and did not tell the bankruptcy court about this money, big problem...as in go to jail problem.
Answer Applies to: Nevada
Replied: 8/17/2017
    Ronald K. Nims LLC | Ronald K. Nims
    As long as the cash was earned after you filed or disclosed on your schedules, there is no problem with buying a car in a Chapter 7.
    Answer Applies to: Ohio
    Replied: 8/17/2017
    Law Office of Kimberly Fives | Kimberly Fives
    What is key is whether or not you listed the cash on your petition and whether it was legally exempt- meaning you were able to keep it. If you failed to list the cash at all it could be considered fraud and you could be denied a discharge altogether. Consult your bankruptcy preparer to be sure.
    Answer Applies to: California
    Replied: 8/17/2017
    Richard B. Jacobson & Associates, LLC | Richard B. Jacobson
    Yes-so long as the Trustee has no claim on the money you are using to buy the car. For example, if you use post-petition earnings (which are not generally part of the bankruptcy estate, at least in Ch. 7), or money in the bank that you exempted. The Trustee and creditors have 30 days after the meeting of creditors to object to exemptions, although they rarely do. So you should wait at least that long if you are using money you have exempted. In a Chapter 13, especially if you are incurring new debt, you must notify the Trustee and get his or her agreement.
    Answer Applies to: Wisconsin
    Replied: 8/17/2017
    Law Office of Stuart M. Nachbar, P.C.
    Law Office of Stuart M. Nachbar, P.C. | Stuart M. Nachbar
    I would strongly recommend that you wait until at least your counsel (or you if pro se) receive the Trustee Notice of No Distribution if you are not going to wait for the discharge.
    Answer Applies to: New Jersey
    Replied: 8/17/2017
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