I've been thinking. It seems that bankruptcy fraud is really a situation in which someone gets a big advance, and then declares bankruptcy shortly thereafter. In my situation, if one looks at the levels of use over the last 7 years, one would see that I have carried high balances for long periods here and there (basically to put money in the stock market, which up until this year, I have been successful.) I would only put money in the market when I thought that the market was ready to go up at a higher rate than the credit card rate. Many times the rate was 0%, so it was a no brainer for me, and actually 2003 & 2004 were very good for me, as I typically made about 30% return, while paying only an average of 2-4% (I think I capped any debt at 6% - i.e., I would not take any debt higher than that.)
Anyway, I've got to think that a judge looking at this could say to the creditors, "well, maybe he should have declared bankruptcy a while back, but since he didn't, and he kept up to date on the payments, you've probably made more on his debt that your loss here," not realizing that I was paying a very low rate. Or perhaps he sees this and says that if a person has been carrying debt for a long time, obviously he must have figured out a way to do it, and the current shocks of the economy have changed that, making him unable to do it anymore.
In my particular situation, I took about a $25K loss from September 2008 to March 2009 in the market, which was right about the time I since took my last naked cash advance, at which time I took probably $30K in total (investing $11K of it, that turned into about $16K.) NOTE: I define a naked cash advance as not having any recent history of taking the advance, as opposed to a swap, in which I have carried a balance for a long time (i.e., usually for the 12 month period of the 0% balance transfer), use some cash to pay it off, and then get a subsequent 0% cash advance from that account. I wouldn't consider a swap to be real cash advance, just an extension of the debt from before.
I've been making payments back to these creditors on the order of about $30K since then. So in essence, if I were supposed to have just declared bankruptcy then, I would have not taken the $30K in naked cash advances, and the creditors would not have gotten $30K of debt payments since then, and a residual of $16K from the investment that was made. And since I was living on only about $1700 a month, I only have spent about $12K since then, so the creditors are now in a position of me having $4K more then they would have, had I declared bankruptcy back then!
I'd like to think that a judge would see that if a debtor were insolvent, but he kept making debt payments for a long time, that if the total of the payments were at the same level as the naked cash advances that he had taken while being "insolvent", then there is no net loss, since the creditors have already been paid for their trouble (although one could argue that a creditor who just got the naked advance took a loss to make way for the other creditors who got a little back.)
As usual, my stories are complicated, but if properly considered, they make sense.
Anyway, I've got to think that a judge looking at this could say to the creditors, "well, maybe he should have declared bankruptcy a while back, but since he didn't, and he kept up to date on the payments, you've probably made more on his debt that your loss here," not realizing that I was paying a very low rate. Or perhaps he sees this and says that if a person has been carrying debt for a long time, obviously he must have figured out a way to do it, and the current shocks of the economy have changed that, making him unable to do it anymore.
In my particular situation, I took about a $25K loss from September 2008 to March 2009 in the market, which was right about the time I since took my last naked cash advance, at which time I took probably $30K in total (investing $11K of it, that turned into about $16K.) NOTE: I define a naked cash advance as not having any recent history of taking the advance, as opposed to a swap, in which I have carried a balance for a long time (i.e., usually for the 12 month period of the 0% balance transfer), use some cash to pay it off, and then get a subsequent 0% cash advance from that account. I wouldn't consider a swap to be real cash advance, just an extension of the debt from before.
I've been making payments back to these creditors on the order of about $30K since then. So in essence, if I were supposed to have just declared bankruptcy then, I would have not taken the $30K in naked cash advances, and the creditors would not have gotten $30K of debt payments since then, and a residual of $16K from the investment that was made. And since I was living on only about $1700 a month, I only have spent about $12K since then, so the creditors are now in a position of me having $4K more then they would have, had I declared bankruptcy back then!
I'd like to think that a judge would see that if a debtor were insolvent, but he kept making debt payments for a long time, that if the total of the payments were at the same level as the naked cash advances that he had taken while being "insolvent", then there is no net loss, since the creditors have already been paid for their trouble (although one could argue that a creditor who just got the naked advance took a loss to make way for the other creditors who got a little back.)
As usual, my stories are complicated, but if properly considered, they make sense.
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