credit card usage questions

[tryingfor4]

We have yet to file and are trying to prepare ourselves.

My question is regarding credit card usage. At this point we have not been missing any payments, but we are typically using the cards for as much as we are paying on them. So, total we have about 800$ a month in min. pays and are using them for groceries, gas etc. for average 600$.

Everyone says to stop using for 90 days before, but we can not and still pay minimums.

Also, what falls under "luxury". I was thinking of going ahead and getting my 2 baby girls some summer clothes. I'm talking second hand stores and discount stores, not expensive stuff. Would things like this be covered if bought within 90 days?

I am totally just starting, so if questions are way off base, sorry!

[HHM]

Let's back up.

You haven't missed a payment on your credit cards, but at the same time you are using credit cards for basic needs etc.

Ok, you need to sit down and crunch some numbers, if you had NO credit card debt, would you be able to pay for your basic needs, food, rent/mortgage, car payment, groceries, insurance, clothes etc without using credit cards. If the answer is no, you should not file BK at this point because BK will NOT solve the underlying problem. (the underlying problem being too little income and/or too many expenses).

[tryingfor4]

I have added up house payment and monthly payments and after that having apx. 900$ left, which is going mostly to cc's. My hubby does some side work now and then that brings us extra cash and that makes a hugh difference.

[woeisme]

If you have absolutely decided to file BK, why keep paying the minumum payments? Use this money for your expenses, and let the cards go unpaid for the 90 days before you file. If you are planning CH 7, it makes no sense whatsoever to pay on bills that will be discharged in Bankruptcy. Do you really think it's going to look "better" that you never missed a payment right before you file and get all of your debt discharged? Your credit rating will be in the tank anyhow, so who cares if it's a 580 instead of a 545? Are you afraid of the phone calls? I know I was! I also had never been late with a payment before going the BK route. I hated not paying the minimums, even though that was what was preventing me from having enough $ to pay my real monthly expenses. But once I decided for sure to file (CH 13) and I let those first payment dates pass, and the sky did not fall in, nothing horrible happened! Don't know what I was worrying about. When the phone calls and letters started, I just took down information of who was calling when, what I owed, and said thank you and hung up. Once I retained my lawyer, gave them the attorney's #, and the phone calls pretty much went away too. It will all work out, believe me, know where you are at! Even if your CH 13 and have to propose a payback plan, still won't matter if the late fees and interest rack up in the 90 days while you don't pay on the cards, your payback amount is calculated based on your disposable income, not on how much the total bills are, so they don't end up getting those fees anyhow unless you are in 100% payback. Good luck!

[justplaintired]

You sound very much like us. Our total min. payment came to about what your does. We always paid the min. trying very hard to keep our credit good.

Anyway keeping those min. paid on time left us very little income for necessities like groceries, gas, clothes.... so basically we used the cards for necessities.

I worried like you on how we would live without cards. Well after talking to the attorney we found out we don't pay on cards anymore, so he asked can you make it on the cash left over, plus what we are paying on cc. Guess what, we can. Sure we can't buy all those luxury items, but those aren't necessities. We have income left over to pay all those necessities cc min payments was taking.

My hubby also has a small mowing business that helps, so I am sure we will be fine. Actually we quit using cards almost 3 months ago and we are fine. Money is tight from time to time, but we haven't starved and won't. Now we watch what we spend and I am making my hubby much more aware of where the money goes, how it should have been all along.

Good luck and maybe you should do a free consultation with a few lawyers if you haven't. That's what we did and it made us see how we would survive without cards, and they were right.