Charges out of necessity

[Noangelmom]

We are planning to file in April and since my husband lost his job we had been paying for necessity things (groceries, gas, home repair) on credit cards since we couldn't pay cash for them. Since we made the decision to stop paying our cc bills (this month) and file for chapter 7 next month... will these charges on the credit cards put us at fault?

[DeadManCrawling]

Not unless there are luxury purchases on there, like new computers, TV's, etc.

A bigger question is this: Can you afford to pay for these things without a credit card after you file? If not, you may be jumping the gun.

[blessed]

Yeah, what he said.

We had some normal expenses on February's statement for ONE CC and it wasn't a problem to file today.

[outofdebt201]

Is this information your laywer stated? Because I was under the impression that you couldn't charge anything, and I mean ANYTHING 3 months before you filed.

Any information would be helpful.

[keepmine]

Is this information your laywer stated? Because I was under the impression that you couldn't charge anything, and I mean ANYTHING 3 months before you filed.

Any information would be helpful.

The code distingushes between luxury purchases and necessities.

http://doney.net/bkcode/11usc0523.htm

(i) for purposes of subparagraph (A)--

(I) consumer debts owed to a single creditor and aggregating more than $500 [$550] for luxury goods or services incurred by an individual debtor on or within 90 days before the order for relief under this title are presumed to be nondischargeable; and

Now, having posted this- I'm of the opinion that once bk is a viable option you need to put the cards away. Stop paying all debt that will be discharged and use the money you were paying on this to provide the basic necessities. If you still can't make ends meet then, you have a problem bk can't fix. After all, post bk you still need to support yourself.

[BCA2009]

We stopped using credit about 50 days before we filed. But tha was also when we stopped making payments. Once we stopped making payments, we never charged anything else.

I think if you stopped making payments months ago, but still were using the cards, it might be an issue.

[outofdebt201]

I understand that, I stop using my credit cards two weeks ago and I'm about to stop paying them this month. I'm going to use the money to pay off the laywer and but this behind me.

We stopped using credit about 50 days before we filed. But tha was also when we stopped making payments. Once we stopped making payments, we never charged anything else.

I think if you stopped making payments months ago, but still were using the cards, it might be an issue.

[Noangelmom]

We used the cards in Jan. and Feb. ... no aggregate charges over $500 on one card. (which is what my lawyer said as well.) This month we had a huge electrical issue in the kitchen which blew out our microwave and the light fixture so we had to replace those items - partly on a credit card. We were told by the lawyer to use the tax money for home repair and necessary items and make sure we spend it all before we file. I expect the tax money to come in at the end of March. It sucks that the electrical issue happened this month since we don't have the tax money yet.

Since our decision to file occured last week, we have stopped using and paying the credit cards and will be using cash from here on out.

[MrBankruptcy]

You shouldn't use them but as long as they are small purchases ther won't be any question . The worst thing that would happen is they would ask to repay those purchases. I've heard of people paying their attorney with a card then filing a couple months later. This is an extreme but when people are pushed by stress they do what they have to to survive.

[LetItGo]

The other thing to think about is do you have to file so soon. We didn't file until about eight months after we made the initial decesion and stopped using the cards (and payments).

[MrBankruptcy]

No one will question that. You should be fine

[Flamingo]

Realize that if you use your credit cards and you know you are bankrupt and are going to file, that is fraud because you know you are not going to pay the funds back. Stop using the cards right away if you are going to file. That is one of the first things an attorney asks you when you go in for an appointment; when was the last time you used the credit cards and what for. Upon retaining our attorney, we were told to stop immediately but at that point we were robbing Peter to pay Paul and the entire mess was getting ready to crumble. We filed two months after retaining our attorney.

[StartingOver08]

There is rarely a need to rush to file. If you look at the posts, much of the trouble comes from not planning appropriately or retaining the wrong attorney.

Reconsider filing next month. Like DMC points out, can you learn to budget without the cc's on your current income? If not, take the extra time to learn to live without the cards before filing.

BK gets rid of debt. It does not solve an income issue. Figure out your income issues before you file.