Bankruptcy Law Changes: NO Credit Charges Within 3 Months, IRA protection

[bkfiler]

NO Credit Charges Within 3 Months - The law also requires all charges on cards within three months of bankruptcy be paid by the consumer. Very frankly, I'm surprised this is listed as a change because it was my understanding, this was always the case. Or perhaps I just felt it should be the case. There was a Forum string at this site about a year ago. A person was wondering why they couldn't take a European vacation on a card and then file. I was happy the community responded with a very common, "Irresponsible deadbeat!"

IRA's - Bankruptcy should and will now protect money set aside in an education IRA but at the same time it puts a cap on what can be shielded from creditors in a Roth or other IRA. I would point out, however, that the cap of $1 million is set far to high.

http://credit.about.com/cs/legal/a/040601.htm

[SinkingFast]

The way I read the law, it said something about charges of $1250 (think that was the number) or more within 60 days, potentially constituting fraud. I "thought" that meant ONE single charge of that amount, but wondered if it meant cummulative charges equalling that amount. I wondered. Then one attny said no charges for a minimum of 70 days, 90 days was preferred, prior to filing. I asked about the $1250 figure. Attny said any CC company could make a case for fraud over a $10 charge w/i 60 days. I didn't realize the creditors could go after you "legally".

[bkfiler]

any creditor can still go after you regardless of the amount of length of time elapsed. all this law did is make it so that any charges within the time limit non-dischargable essentially.

it made it worse for us.

[SinkingFast]

Well, we've marked the calendar with the date of the most recent charge. Now we're counting down the days.

[bkfiler]

remember that the objection and any legal bettle that follows will only be fore the actual charges that were considered 'too soon' or 'wrong' the rest of the money owed on that account is not involved.

that amount sub-amount, if objected to, would then be possibly further reduced down by negotiation for a lower total, payments and maybe even no interest at all as well.

during which the rest of the charges in the list move along toward discharge.

it really works out well that way.

[FoolAndHisMoney]

Here's the new rule:

New Bankruptcy Law taking effect on October 17, 2005: Debts you incurred on the basis of fraud, such as lying on a credit application; Credit purchases of $500 or more for luxury goods or services made within 90 days of filing; Loans or cash advances of $750 or more taken within 70 days of filing;



This is just the presumption period. If your charges are 2 years old or 2 weeks old the creditor can dispute it no matter what. If it's inside the above time frame then the debtor has to prove to the court that he didn't intend on filing and that's hard to do so close. Outside the 70-90 days the creditor must prove it knew a debtor intended on filing and that's even more difficult to do if it's been a while which is why most creditors don't bother disputing it.