Paying on one credit card but not the others...

[Brookamy]

Will be filing chapter 7 soon. Have stopped paying my credit cards...about 5 of them for a little over a month now. We financed my wedding ring on a Wells Fargo credit card. We owe more than my ring is worth obviously. We have paid the minimum on the card and are still up to date on it. I'm worried that if we don't keep paying/reaffirm that the trustee will want my ring or the creditor will ask for it back. Is it bad to pay only one card? Is that considered preferential payment or whatever? Will they take the ring if we stop?

[becky20]

These are all just my answers based on my limited knowledge, so hopefully one of the "experts" will chime in, but...

When did you buy the ring?

I think you're wasting your money paying on the ring if you know you're filing... Anything more than a total of $600 over the past 90 days (I believe) is considered preferential payments. Since you charged the ring on a normal card and not one that can be considered "secured" (like Circuit City or Best Buy cards, furniture store credit, or a jewlery store card), I don't THINK they could take the ring. But it depends on how much the ring is worth, and what your states exemptions are... If it's worth more than the exemption for your state, then I think they could take it or make you pay them (the trustees) the difference between the exempt amount and the value.

I'll be interested to see what the experts answers on this is...

[AngelinaCatHub]

I am a dummied one, however I do know this, wedding rings (engagement ones) are absolutely exempt. Read on here and welcome. If you are doing C7, Nolo.com has a download of the book on 7 at about 17 bucks. WELCOME. 'Hub and Mrs.

We live in FL, and you must check your own state. Here if you do not know how, we can lead you. More info would be needed.

Edit: Becky is right. 'Hub and Mrs.

[justplaintired]

Wedding rings up to $1225 are exempt in your state, I found this on the web. Now since you owe money you really need to find out how this will be handled. And then alot also depends, was this a recent purchase? Within 6 months? This could possibly be considered a luxury purchase. Don't worry, worse case you make an agreement to keep paying on the rings. I would find out before I made another payment. Just ask your attorney how to handle this one. I am not sure if that cc purchase would be considered secured since you did buy rings. I don't blame you I would want to protect my wedding rings too.

Good luck!

[keepmine]

If this was a WFC visa or Mc, it's unsecured debt. No different from using the card for movie tickets or a meal.

[Brookamy]

We bought the about a year ago. Don't think it is worth as much as we owe. It was financing through the jewelry store and is a Wells Fargo line of credit/credit card.

[jktrading]

These are all just my answers based on my limited knowledge, so hopefully one of the "experts" will chime in, but...

When did you buy the ring?

I think you're wasting your money paying on the ring if you know you're filing... Anything more than a total of $600 over the past 90 days (I believe) is considered preferential payments. Since you charged the ring on a normal card and not one that can be considered "secured" (like Circuit City or Best Buy cards, furniture store credit, or a jewlery store card), I don't THINK they could take the ring. But it depends on how much the ring is worth, and what your states exemptions are... If it's worth more than the exemption for your state, then I think they could take it or make you pay them (the trustees) the difference between the exempt amount and the value.

I'll be interested to see what the experts answers on this is...

I believe Circuit City and Best Buy cards are unsecured lines of credit, just like Visa and MasterCard. I'm not so sure about jewlery cards and the like, but if you sold whatever you purchased, exactly what is the secured part? The only secured thing I can think of is a car and a house. What else needs papers to sell?

[becky20]

I know on another board people were talking about how for certain store cards, and large purchases, there were times that the creditor was demanding return of the item (for instance, if you bought a Dell laptop on the Dell charge account, and then filed, they were demanding their laptop back). Another person posted Best Buy calling them up to pick up a large item that had been very recently purchased. I would think jewelry might also fall under this category if purchased on their store credit card... Definitely ask the attorney...

[jktrading]

I know on another board people were talking about how for certain store cards, and large purchases, there were times that the creditor was demanding return of the item (for instance, if you bought a Dell laptop on the Dell charge account, and then filed, they were demanding their laptop back). Another person posted Best Buy calling them up to pick up a large item that had been very recently purchased. I would think jewelry might also fall under this category if purchased on their store credit card... Definitely ask the attorney...

Perhaps creditors would do that, even Visa and MasterCard creditors, but if you no longer have the item(s), what are they going to do? The only thing they can do is sue you, and that's what BK stops. They can attempt all they want to get the item back.

There's no secured item they can take like a house or a car. All I'm saying is that a card without anything that you need to verify ownership to sell is not secured. Best Buy, Circuit City, store cards, jewelry cards, cannot truly be "secured." Other than they can sue you.

[lrprn]

We bought the about a year ago. Don't think it is worth as much as we owe. It was financing through the jewelry store and is a Wells Fargo line of credit/credit card.

What matters are two things: 1) Can the true market value of the ring be protected by the bankruptcy exemptions in your state, and 2) Has sufficient time passed and the ring devalued enough that the creditor will not object to discharging the debt.

How much did you pay for the ring and how much is it worth now?

And Ms. Angelina, we have had posters here whose trustee has asked them to have their wedding and engagement rings' market value evaluated by a jewelry expert. There are definitely some hard-nosed trustees that will take high-value wedding/engagement rings that cannot be protected by the filer's state exemptions.

Luckily jewelry devalues rather quickly after purchase, so most of the time wedding and engagement rings are safe. But not 100% of the time.

[Brookamy]

Hmmmm...we paid $3,000 for the set. Not sure what it would be worth now. Guess I should have it appraised. We still owe about $2,000 grand. I'll have to check what my excemptions are as well. We will keep paying on this card for now.

[hnhlvr]

Can't you file Ch. 7 including that card and then reaffirm the debt you have for the ring so you can keep paying on it? I'd think THAT would look better than you just paying only on that card and showing preferential treatment.

[Brookamy]

Yeah, we could definitely reaffirm on that card and that is the plan...but do I keep paying on the card in now? I'm still trying to to pay for the attorney and wont file until October or so.