topic Using Credit Cards before Chapter 7 filing? in Bankruptcy

Using Credit Cards before Chapter 7 filing?

Anonymous — Wed, 25 Jul 2018 06:16:15 GMT

Hi,

I am considering filing chapter 7 in California. I met with an attorney but have not filed yet. He advised me that I can still use my Credit Cards

"to live" before filing as long as the charges don't come off as extravagent or luxurious.

I'm wondering if anyone has experience with NOT getting all debts discharged by creditors due to spending in close proximity to filing? If so, what kind of charges were denied discharge?

Thanks so much for any help you can provide!!!

Re: Using Credit Cards before Chapter 7 filing?

despritfreya — Wed, 25 Jul 2018 11:45:35 GMT

@Anonymous wrote:
Hi,

I am considering filing chapter 7 in California. I met with an attorney. . . He advised me that I can still use my Credit Cards"to live" before filing as long as the charges don't come off as extravagent or luxurious.

If this "attorney" actually did tell you this, you need to report him to the State Bar and the Office of the US Trustee as he has violated 11 USC 526(a)(4). That provision prohibits a "debt relief agency" (which includes the attorney) from advising an assisted person (you) "to incur more debt in contemplation" of the filing of bk. Advising you that it is perfectly fine to use your credit card to live before filing, IMHO, is a direct violation of this law.

Des.

Re: Using Credit Cards before Chapter 7 filing?

pizza1 — Wed, 25 Jul 2018 15:44:44 GMT

If you use your cards for luxury type items and services within 90 days of filing, and/or cash advances on your card within 70 days of filing, fraud is presumed and your BK will be dismissed. To be safe, don't use any credit for anything at all 90 days before filing. Id find a different attorney.

Re: Using Credit Cards before Chapter 7 filing?

CashBackQueen — Mon, 13 Aug 2018 11:56:13 GMT

Upon researching before I filed last year, I think I'd read the same thing. Like if you had to pay your light bill or something, it's okay. But if you're buying new clothes or booking a vacation, that can definitely jeopardize your bk. I could be wrong, but that was also my understanding at the time. I did end up using credit for one utility bill about a month prior and my bk went flawlessly.