topic Re: Need Advice: Filing Bankruptcy Despite Perfect Credit and No Losses to Lenders in Bankruptcy

Need Advice: Filing Bankruptcy Despite Perfect Credit and No Losses to Lenders

Advice2Rebuild — Tue, 11 Nov 2025 07:45:05 GMT

Hello Everyone,

I am currently in a precarious situation that has been building over the past six months. Due to a legal system that allows con artists to take advantage of hardworking people, I am now in a position where I will be filing for Chapter 7 bankruptcy to discharge a personal judgment.

I’ve already received excellent advice from qualified counsel and have completed a fire sale of my home and other assets. I plan to file for Chapter 7 after the new year, around March, with essentially nothing left to show for it. Currently, I have no significant debt—just balances that I pay in full each month. I have long-standing relationships with Citi Bank, American Express, and Chase for my credit cards, as well as several store cards with Nordstrom and Macy’s. The mortgage I had is now paid off, and all I have is a Auto Lease.

I’ve had many of these credit cards for decades, and I’m very upset that I’ll have to close them myself before filing—otherwise, they’ll be closed automatically afterward, from what I’ve been told. My main question is this: after the filing, when can I expect my life to start resembling what it was before?

None of these credit card companies will be taking a loss. I plan to ensure that all balances are paid in full and that the accounts are closed several months prior to filing. I’ve had my Amex and Chase cards (previously Bank One) since the mid-1990s and have maintained perfect relationships with both companies. I’m curious whether that history will play any role in being approved for new accounts with them one or two years after the discharge. I’m less concerned about Citi Bank, but I have enjoyed the benefits of the American Airlines card I have with them.

Another question: I’m currently leasing my car, which I’m scheduled to return next summer. Would it be wiser to purchase a new car with an auto loan now—while my credit is still perfect, considering the planned purchase is a New Range Rover? If I make a substantial down payment, what would my options be two or three months after the discharge for financing a vehicle like that? Would it still be possible to purchase something similar?

I would greatly appreciate input from anyone who has gone through a discharge but made a point not to harm their creditors in the process. As you can imagine, I’m beyond frustrated with the situation I find myself in.

Re: Need Advice: Filing Bankruptcy Despite Perfect Credit and No Losses to Lenders

GZG — Tue, 11 Nov 2025 09:47:03 GMT

is your qualified counsel a BK attorney or do they have experience with BK?

NAL, but paying other creditors and avoiding paying your judgement sounds like something your creditor can use to prevent a discharge of the BK

I would probably speak to a couple of BK attorneys about your plans and sanity check your plan

Re: Need Advice: Filing Bankruptcy Despite Perfect Credit and No Losses to Lenders

JoeRockhead — Tue, 11 Nov 2025 10:51:46 GMT

@Advice2Rebuild wrote:
Hello Everyone,

I am currently in a precarious situation that has been building over the past six months. Due to a legal system that allows con artists to take advantage of hardworking people, I am now in a position where I will be filing for Chapter 7 bankruptcy to discharge a personal judgment.

I’ve already received excellent advice from qualified counsel and have completed a fire sale of my home and other assets. I plan to file for Chapter 7 after the new year, around March, with essentially nothing left to show for it. Currently, I have no significant debt—just balances that I pay in full each month. I have long-standing relationships with Citi Bank, American Express, and Chase for my credit cards, as well as several store cards with Nordstrom and Macy’s. The mortgage I had is now paid off, and all I have is a Auto Lease.

I’ve had many of these credit cards for decades, and I’m very upset that I’ll have to close them myself before filing—otherwise, they’ll be closed automatically afterward, from what I’ve been told. My main question is this: after the filing, when can I expect my life to start resembling what it was before?

None of these credit card companies will be taking a loss. I plan to ensure that all balances are paid in full and that the accounts are closed several months prior to filing. I’ve had my Amex and Chase cards (previously Bank One) since the mid-1990s and have maintained perfect relationships with both companies. I’m curious whether that history will play any role in being approved for new accounts with them one or two years after the discharge. I’m less concerned about Citi Bank, but I have enjoyed the benefits of the American Airlines card I have with them.

Another question: I’m currently leasing my car, which I’m scheduled to return next summer. Would it be wiser to purchase a new car with an auto loan now—while my credit is still perfect, considering the planned purchase is a New Range Rover? If I make a substantial down payment, what would my options be two or three months after the discharge for financing a vehicle like that? Would it still be possible to purchase something similar?

I would greatly appreciate input from anyone who has gone through a discharge but made a point not to harm their creditors in the process. As you can imagine, I’m beyond frustrated with the situation I find myself in.

What type of judgement is this because not all judgements are dischargable. As asked above did you talk to an actual bankruptcy attorney?

I ask because you’ve got some serious potential landmines in that plan. Chapter 7 isn’t a “strategic reset”, it’s a last-resort process the court looks at very closely. A few things jump out:

Fire-sale danger: Selling off assets right before filing can backfire hard. If you sold below market or to friends/family, the trustee can claw that back as a fraudulent transfer. Under lookback provisions the trustee can look at transactions up to 2 years under federal law and longer in some states. That’s how people lose their discharge, get their cases dismissed.
Paying off cards pre-filing: You can’t pick and choose who gets made whole. Payments to creditors within 90 days before filing can be reversed as “preferential.” Closing the cards yourself doesn’t protect them, or you. They’ll be closed either way once the bankruptcy hits.
Car problem: Financing a Range Rover while planning a Chapter 7 is begging for scrutiny. The trustee will see it as converting cash into a luxury asset and might force a sale.
“No debt, perfect credit” issue: If you’ve liquidated everything and still file, the trustee might wonder why you’re not in Chapter 13 instead. Chapter 7 is for people who can’t pay, not for those who just don’t want to deal with a judgment.
Credit recovery: Amex and Chase won’t care how long you’ve been with them once a bankruptcy shows up. You’ll start over with secured cards, rebuild for a few years, then maybe get back in. Amex for example won't let you back in for 61 months. Chase, who knows.
Timing: Waiting until March doesn’t matter unless your attorney says it does. Every deposit, sale, or payment between now and then is something the trustee can question.

Before you fully commit to this plan, I'd strongly recommend you stop moving money, and stop buying things. Let your attorney guide every step from here. You can most certainly recover after a bankruptcy, but if the trustee thinks you played games on the way in, you're asking for trouble.

Re: Need Advice: Filing Bankruptcy Despite Perfect Credit and No Losses to Lenders

Cowboys4Life — Tue, 11 Nov 2025 15:50:15 GMT

"Due to a legal system that allows con artists to take advantage of hardworking people, I am now in a position where I will be filing for Chapter 7 bankruptcy to discharge a personal judgment."

All the other advice was spot on. You don't say what state the judgment is in but there are more than one way to deal with one that doesn't include bankruptcy and is legal. A few states have long SOLs and post judgment interest or ability to renew that can make not paying a judgment a bad idea. However, if you are in a consumer friendly state like Texas for example that doesn't allow a lien on property to collect a judgment or wage garnishment then living "unbanked" is a good option. You essentially keep all your money in an account in your spouse's name (assuming you have one) or another trusted person. You pay all your bills from that account and only keep $20 in any account with your name. Or no account at all. That way if they have a debtor's exam you don't lie but you don't have any assets in an account they can levy.

I would also consider moving to a state like Texas until the judgment expires even if you rent. Limit their ability to collect. Google it. There are a LOT of legal ways to slow it down but appealing and getting it over turned might also be more appropriate too.

Re: Need Advice: Filing Bankruptcy Despite Perfect Credit and No Losses to Lenders

FicoMike0 — Tue, 11 Nov 2025 15:56:19 GMT

Wow, this looks like a thread we can learn a lot from!

Re: Need Advice: Filing Bankruptcy Despite Perfect Credit and No Losses to Lenders

Varsity_Lu — Tue, 11 Nov 2025 16:31:47 GMT

@FicoMike0 wrote:
Wow, this looks like a thread we can learn a lot from!

Agreed. Honestly, almost everything mentioned above goes right over my head. I literally have no idea what the OP or replies even mean.

Re: Need Advice: Filing Bankruptcy Despite Perfect Credit and No Losses to Lenders

Advice2Rebuild — Tue, 11 Nov 2025 21:50:44 GMT

It’s a civil judgment, and the state is California. The judgment is for nearly three-quarters of a million dollars in frivolous nonsense.

The house was sold through a standard market sale, priced to move, and listed on the MLS. I did not sell the house for 50% off. Instead, I likely took about a 10–15% loss by pricing it lower to ensure a quick sale. We had it under contract within two days, and I’ve already divested the proceeds into an account that is untouchable by the bankruptcy courts. As I mentioned, I’ve been working closely with highly qualified counsel to ensure this judgment creditor ends up losing both their litigation costs and the judgment itself.

As for the credit cards, I actually wanted to keep them through the holidays—particularly the Citi card—but I’ll likely cancel all of them within the next week or so after paying them off. That way, there’s no opportunity for a look-back or any damage to my relationships with the lenders.

Regarding the car, I wasn’t planning to make a substantial down payment for that exact reason—just the bare minimum. My credit score is currently around 810, so I would have no difficulty getting approved for financing right now. My question is: what are my options two to three months after a discharge for financing a $120K–$140K vehicle? I don’t want to be left scrambling to find financing or asking a close friend to co-sign. I’d rather have that secured ahead of time. I assume that with a minimal down payment, the financing division of whichever bank I use won’t want to repossess the vehicle since it would be “underwater,” so to speak, after driving it off the lot. They’d likely prefer that I simply reaffirm the debt and continue making payments.

As for the Chapter 7 filing, I’ve already been told I’m an excellent candidate. Based on strategic yet lawful actions, the process should go smoothly. I’m mostly frustrated by the inconvenience and the impact this has had on my life. Unfortunately, I’m not in a state like Texas, where I could tell someone to pound sand. I’ve already had to give up my home of twenty years, and I’m determined to make sure this nonsense costs them everything.

Re: Need Advice: Filing Bankruptcy Despite Perfect Credit and No Losses to Lenders

Advice2Rebuild — Tue, 11 Nov 2025 21:54:37 GMT

My counsel is an attorney who specializes in bankruptcy litigation, including creditor rights. I specifically chose her to ensure that everything is done correctly and to maximize the chances of a successful outcome.

Re: Need Advice: Filing Bankruptcy Despite Perfect Credit and No Losses to Lenders

despritfreya — Thu, 13 Nov 2025 01:20:02 GMT

I was going to stay out of this because I knew exactly where this was leading. But, all of you know me and know that when I read things like:

“I’ve already divested the proceeds into an account that is untouchable by the bankruptcy courts.”

I just have to comment.

Wonder how much money is being hidden and where. . . offshore maybe or maybe in crypto? Trustee will find it. Just based on OP's comments, I envision a number of 523 and/or 727 complaints in his/her future. Maybe I’m wrong, but having been in this business for over 35 years. . . well, you get the picture.

I do wish OP the best of luck. However, OP should not be surprised if the outcome of the Chapter 7 is not what he/she expected.

Des.