Legal Question in Bankruptcy in New Jersey
Bankruptcy preferential pursuant
my ex wife is filing for bankruptcy, i
just got a letter from the ch 7
trustee stating that since she paid
me back a 25k loan on 9/11/07 and
she filed on 6/1/08 which is within 1
yr that i have to give that money
back according to 11 USC 547. do i
have to pay this money back which i
dont have and was taken out of a
home equity to lend to her?
1 Answer from Attorneys
Re: Bankruptcy preferential pursuant
Generally speaking, the source of the funds used to loan to your ex-wife do not factor into the analysis of whether the repayment back to you was preferential under Bankruptcy Code Section 547. While the trustee is entitled to recover the transfer to you if he/she can demonstrate the requisite elements, the facts may give rise to a defense under Bankruptcy Code Section 547(c), based upon new value or ordinary course. I regularly handle these matters if you require further information.
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