Question about fraud

[Brokecoloreefer]

Im courius what constitutes fraud. What if you have made severl thousand dollars worth of stuff over a 6 month period, because you have a spending problem and cant handle your money well. You made these purchases with the intention of making minimium payments on your cards you used. One spouse looses a job and you cant afford to make the minimums any longer. If you wait 6 months to file would they consider your purchases fraudulent? If they do then what? Whats the penalty? is it criminal or will they not incude the charges in the BK case?

[BassBoy]

Well, it's not considered fraud if you racked up debt and then filed BK. It's abuse. If this happens, you won't to go jail (LOL!), the debt will be excluded from the BK, meaning it will not be discharged and you'll be responsible for that debt. On the other hand, I don't believe a 6 month wait will raise any red flags. However, don't be surprised if the creditor asks for the item(s) be returned, especially those that are department store debts (i.e. Kohl's, Home Depot, Dell and those of the like).

Fraud is more along the lines of transferring assets, hiding assets and flat out lying on your petition.

[Brokecoloreefer]

Well, it will probably look like abuse. My wife lost her job for christmas instead of getting her usual bonus. Now we cant afford our bills. We knew when we made these purchases that we were going beyond our means at the time. But thats not unusal for us. The stuff i bought was aquarium related. I was going to start a small business building acrylic aquariums and needed better tools, i was also going to start propogating corals and needed some equipment for that as well. Since my wife lost her job, i havent had time to mess with either. Her income was about 65% of the total household income and now we are in trouble. CC companies are calling daily. We are just paying them what we can afford, which is some cases might only be $10, but there all getting something. How long can i keep this up before they sue me?

[BassBoy]

It's good you've been paying them something every month. It shows good intentions to re-pay the debt(s). I commend you for doing your best during this difficult time.

As far as how long you can keep it up before they file a lawsuit can vary from city to city and creditor to creditor. It could be a few months or it could be 6 months. The creditor could act fast, but the courts could be backed-up. If a suit is filed, your BK should stop it.

[Brokecoloreefer]

It was very bad timing, we racked up about 6k of debt back in september and october. That was on top of 10k of revolving debt that we were paying off on time. At the time we had a 750 credit rating. December 1 my wife lost her job, and that put us in a world of hurt. She is 5 months pregnant and cant realy find another job right now anyway. Im worried about that 6 week period that we charged alot of stuff. We have one CC company that calls almost every day, they are very aggressive. Maybe we shoud cut out the ones that arent hassling us and pay them there minimum to prevent them from taking us to court. I dont know how much time i need to buy to make that september/october spending spree not look like abuse.

[SinkingFast]

Also, Creditors don't just summarily sue. They check you out first to see if you have assets worth attaching or income worth garnishing. When we started cleaning up our Credit, we found that BoA had been pulling our Credit regularly prior to when we filed.

I would suggest you schedule 3-4 Consult appts with attnys who specialize in BK. Get different perspectives. Meet different people. Find the person you're comfortable working with. Get your docs assembled and your fees paid. Then your attny is all set to file on a moment's notice if need be. Then wait. Wait as long as you can to file.

If it starts to look like something is gonna happen, a Creditor is gonna take action, then get your pre-BK Cert, and file.

[BassBoy]

To be safe, I would wait until it's been 6 months since your last CC purchase before you file. Personally, I would wait as long as possible to file.

I wouldn't change the way you're paying your creditors. If they are all receiving roughly the same amount for payment, then keep doing that. As I said, it will appear that you had your best intentions to re-pay and you didn't favor one creditor over another. Not saying that this would raise any flags if you did, but you would have peace of mind that you did all that you could to satisfy each creditor equally and no one would question that. I think what your doing now looks better for you.

[Brokecoloreefer]

What will determin the length of time we can wait untill we file? Is it a matter of how long we can hold off the CC companies from sueing us? This might be stupid questions, but i appreciate the help

[Spartan]

"....We knew when we made these purchases that we were going beyond our means at the time...."

Those words shall not be spoken again. Making purchase when you know you are beyond your ability to repay... is fraud.

[Brokecoloreefer]

I think people buy things they cant afford with credit cards all the time so they get "financed". I dont think i was implying that i was trying to defraud anyone.

[yomama]

I think people buy things they cant afford with credit cards all the time so they get "financed". I dont think i was implying that i was trying to defraud anyone.

Whether or not you you were implying that you were trying to defraud anyone or what you were thinking at the time you made your purchases is one thing, but what the courts and creditors think is a different story. Don't make the statement to them that you made here or they will say that your intent was to defraud the credit card companies.

[Brokecoloreefer]

Thank you. i will keep my mouth shut.

[SinkingFast]

Thank you. i will keep my mouth shut.

At least around the Trustee or the BK Judge anyway!!

We understood what you meant when you said it. I certainly didn't read any intent to defraud in your comment.

But Yomama and Spartan are right. Make that same statement at your 341 and you could be in deep doo-doo.

[Brokecoloreefer]

Im glad i found this forum

[yomama]

Im glad i found this forum

So many of us are so glad that we found this forum! Honestly, it has helped me and my husband a lot. We knew absolutely NOTHING about bankruptcy before I found this forum. The advice from people here has been so much appreciated and it has allayed our fears more than I can say.