not making payments before filing!

[ejny65]

How long before filing should I not make any payment (not that I can!) but is this something that I MUST do before filing? how long after cutting credit card payment, the CC company can take me to court?

[yoyoma51]

We were concerned about this also.

I believe the trustee can go back and collect any payments that total over $600 to a single creditor in the previous 90 days before filing. These are called 'preferential payments'. They then distributes that recouped money to all your creditors.

When we met with our attorney we told him we had made these payments and therefore thought we couldn't file yet.

He explained it this way:

-There is no law saying you can't pay them. The trustee gets paid to go back and collect that money. If you made preferential payments, don't worry about it. They will go back and get the money and deal with it. That's their job.

EXCEPTIONS to this rule are if the creditor is an "insider". An insider is usually a family member, co-worker, close friend, etc. that you owe money too. In these cases, the trustee can go bank AN ENTIRE YEAR and collect those payments.

Also, credit cards (or their collectors) will usually wait MONTHS (and many times years) before suing you. If you've filed for bankruptcy, they CAN'T sue you. If they already have a suit started BEFORE you file, the suit is dismissed as the debt will no longer exist (as long as they don't have a judgment from the suit in their favor, meaning the lawsuit is over).

PLEASE NOTE: I am not a lawyer. Bankruptcy may or may not be a best scenario for you. It depends on your situation. You may assume my advice is totally useless. Talk to an experienced bankruptcy attorney (or three) in your jurisdiction for legal advice.