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File now or wait? Confused and scared

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    File now or wait? Confused and scared

    I'm new here and can't even sleep at night due to the stress I'm under. I have approximately 24,000 in credit card debt and I make about 26,000 a year before taxes. Basically I have been robbing Peter to pay Paul for a few years now and it's all going to crash down on me soon. This is no one's fault but my own. I'm still current on all of my credit cards but barely. I have no extra money for saving for emergencies and here lately I have been very frugal about grocery shopping just out of fear of not being able to pay my bills. It's a horrible way to live. I have two concerns about filing next month. The first is that I have a discover card that I have made a few purchase on in the last three months. The last large purchase was in June for about 200.00 for a lawn mower. Mine was completely dead and my yard was growing like crazy so it was almost like a necessity. Before that, like back in may I had purchased a new set of box springs for my bed for about 100.00 because my bed was sagging and it was affecting my sleep. Will these purchases be considered luxury purchases even if at the time I file the purchases will have been made past 90 days? I have read some places where some creditors will look back to up so six months to see if there are any luxury items purchased. I used the card for other things too but not for large amounts. All in all since January I have maybe charged 900.00 to this card plus a balance transfer in the amount of 800.00. It was easier to make the payment through Discover then to navigate through Dell's website.

    My other question is this one. I have been using one card to buy groceries and gas and paying it off at the end of the month. It helps float me in between paydays etc. I basically have been treating it like a debit card and deducting my purchases each time I balance my checkbook. I charge an average of 300-400 dollars a month on the card. Will my payments in full be considered preferential payments even though I have been paying in full each time since the first time I used the card. When I finally came to the decision to file for chapter 7 I quit using the card and went to a cash only system. Yes it's hard but I figured I might as well get used to it anyway. Should I wait and file three months from the date of my last transaction or because it was necessity's will it really matter? Also my statement will arrive today for the balance due in September, I have contemplated paying on the minimum payment to both free up so cash and to make it so that I wont have 600.00 in payments to one single creditor in 90 days time. is this a good idea or not? Will my past payments be considered preferential payments?

    I received a tuition reimbursement from my employer in an amount that should cover an attorney. I figure if I'm short that I can take the money that I would have paid in minimum payments for the month of October and pay my lawyer fees.

    I'm terrified. I know that mine will be a non asset case and I have nothing for the trustee to take but I'm terrified of not paying my minimum payments even for a month and having the credit card companies calling me at work. Home I can deal with because I will just turn off my phone but I would die of embarrassment if one called me at work. How long does it take for them to start calling. I'm guessing that it is right away.

    I have combed through these forums for a few weeks now and it has put my mind at ease but I'm still terrified. Do you think I should go ahead and file in October as planned or wait until the three months have passed since I made a purchase on my credit card that I have been paying in full? Any and all advice is appreciated.

    #2
    Those charges don't sound like luxuries to me. They also don't sound like enough money that a credit card company is likely to bother filing a complaint to have the debt declared not dischargeable. A charge in May is too long ago to be presumed dischargeable, so the creditor would have to prove you made the charges without intent to pay. That's pretty hard to prove, especially since you've been making payments.

    If you make preferential payments, the trustee goes after the creditor for the return of the funds, so it is not your problem. Preferences are a bigger issue if they are to family members or other people who you care about.

    Making payments on dischargeable unsecured debt when you know you are going to file BK is like throwing money away. If you are afraid of creditors calling you at work, answer when they call you at home. If they do call at work, tell them that you are not allowed to take personal callls at work and to stop calling.

    Make a couple of appointments to consult with attorneys. The cosultations may help alleviate your concerns.
    LadyInTheRed is in the black!
    Filed Chap 13 April 2010. Discharged May 2015.
    $143,000 in debt discharged for $36,500, including attorneys fees. Money well spent!

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      #3
      From what I've learned reading around on this site is that the creditors won't sue you for a long time after you stop paying them. Probably at least 6 months. It's been over a year for me, and no lawsuits yet. If you decide to go ahead and file, you can stop paying and wait to file, saving up the money that you would be using on minimum payments.

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        #4
        I made it over a year and a half. Discover card sued me right out of the gate though, after four months. All the others didn't, but my debt was quickly being sold to litigious collection companies around the time I filed.

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          #5
          Discover Bank is by far the most litigious creditor. Out of all my many debts, which I quit paying on back in March 2009, Discover was the only one who sued, and that was in September 2012. All of my other creditors simply wrote off and sold my debts to junk debt buyers.

          Discover sent my account to 7 or 8 law firms over the course of 3 years, eventually they found one willing to file suit. Big mistake though, because I fought the lawsuit every step of the way, running up the plaintiff's attorney fees, and then filed for bankruptcy, never paying a penny toward their judgment.

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            #6
            I've decided to wait and file after I get my tax refund in feb. I need to use that money to get a tune up on my 13 year old car and probably an eye exam too. I will get about 3k back because of the education credit. I figure I will have enough to pay the lawyer fee out of my refund and anything I have left over I can buy food or something.

            I'm current on everything at the moment and I think I can limp along until the spring. I need to wrap my head around the emotional aspect of filing. I don't know why I'm having such a hard time because reading everyone's stories on thi's forum had helped the monkey chatter in my head so much.

            Before I spend a dime of my refund next year, I should talk to my attorney first, right? I want all of my I''s dotted and my t''s crossed.

            I'm sure I will be posting a whole lot in the next 6 months. Thank you to everyone who has responded to my post.

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