Questions about "luxury" items

[taramaxed]

I am a little confused about luxury items. Could someone clarify this for me if possible?

1. What is the time frame for luxury items? I get conflicting answers in my research, some say 60 days some say 90, one even said 20 days.
2. What constitutes luxury? Obviously, a new BMW or a Disney vacation etc. but I read somewhere that a coffee maker is considered luxury
3. What is the limit? Some sites say $600 some say $1000.
4 Is the limit a total of charges or one charge for one thing?
5. If I went grocery shopping at Target would that be luxury because it doesn't say a grocery store, what about clothes for kids at Gap (using my Gap card)?

The reason I ask is because we have been using our credit cards and I don't want to file too early.

[TEW]

I am a little confused about luxury items. Could someone clarify this for me if possible?

1. What is the time frame for luxury items? I get conflicting answers in my research, some say 60 days some say 90, one even said 20 days.
2. What constitutes luxury? Obviously, a new BMW or a Disney vacation etc. but I read somewhere that a coffee maker is considered luxury
3. What is the limit? Some sites say $600 some say $1000.
4 Is the limit a total of charges or one charge for one thing?
5. If I went grocery shopping at Target would that be luxury because it doesn't say a grocery store, what about clothes for kids at Gap (using my Gap card)?

The reason I ask is because we have been using our credit cards and I don't want to file too early.

[taramaxed]

Thanks. We haven't gone on vacation or anything (or plan to) but we have been basically living off our credit cards for daily expenses such as gas, food, clothes, kids activites. We went out to eat a few times over the last 4 months at like Chili's for like a $40 bill for all of us. I went to tanning and got a haircut. Are those bad? We actually need a new kitchen sink because ours is leaking so bad because it has a hole in it. Would that be bad to get a new one?

[TEW]

nothing I see is bad BUT before you file you want to start putting some time between the filing and the card use. stop making payments and stop using the cards get accustom to living on cash

[pcn]

What about her grocery shopping question? What is covered in the 90 day period? No charges whatsoever?

[taramaxed]

We are lucky to live in one of my DH's parents apartments so our living arrangements are good but we are responsible to make all repairs, upkeep and such as a condition for cheap rent. We found out recently that my DS is highly allergic to mold because he's been sick. Our home is infested with mold because we get water in basement. We desperatly need to rip up the carpets and replace them. We were planning on using our tax refund (cash)to do this. Would this be a bad thing? We are planning on using the rest to pay a lawyer.

[catleg]

Here is the actual law )

(a) A discharge under section 727, 1141, 1228(a), 1228(b), or 1328(b) of this title does not discharge an individual debtor from any debt--
(2) for money, property, services, or an extension, renewal, or refinancing of credit, to the extent obtained by--

(A) false pretenses, a false representation, or actual fraud, other than a statement respecting the debtor’s or an insider’s financial condition;

(C)(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

(II) cash advances aggregating more than $750 [$825] that are extensions of consumer credit under an open end credit plan obtained by an individual debtor on or within 70 days before the order for relief under this title, are presumed to be nondischargeable; and

[Dollar amounts in subsections 523(a)(2)(C)(i) and (ii) are adjusted on April 1 every 3 years by section 104. Adjusted amounts effective 4-1-07 are in brackets.]

(ii) for purposes of this subparagraph--

(II) the term "luxury goods or services" does not include goods or services reasonably necessary for the support or maintenance of the debtor or a dependent of the debtor.

[pcn]

(II) the term "luxury goods or services" does not include goods or services reasonably necessary for the support or maintenance of the debtor or a dependent of the debtor.

Can I take it that this means groceries are not included in the 90 day period, if purchased using credit?

[2Bshinyandnew]

Can I take it that this means groceries are not included in the 90 day period, if purchased using credit?

I'll let you know for sure after I file Times are really tough for me right now. My kids have to eat, I'm unemployed and have no medical insurance. I have a car in my name that I could sell to pay bills, but I'm scared THAT will raise a flag. Once I get a job and can support myself, I'll file, but until then I still have one card with available credit left and if my kids are hungry and I don't have money that week, I'm going to the grocery store and use that card. If I don't have the money to fill the RX for my blood pressure meds or put gas in the car, I'll use it.

If that CC issuer wants to dispute the charges for milk, bread, tuna, eggs and cereal, so be it...but I doubt they will. I have used that one card knowing I will be filing BK in the next 6 months or so. I saved the receipts so that I can prove I bought ground meat and chicken on sale and not lobster, shrimp or filet mignon, although that is probably not necessary. Is the aggregate amount I charged on that card for food more than $550 in the last 90 days? Yep. Do I intend on paying it back? If they challenge it, I will so yes, I intend to pay. I won't let my kids starve.

I don't think I would replace carpet or sinks though. Although I understand the OP's situation with the mold and all, I would just keep it to food, gas and prescription meds.

I'm ducking for cover now!!!! I confessed.

[fltoo]

nothing I see is bad BUT before you file you want to start putting some time between the filing and the card use. stop making payments and stop using the cards get accustom to living on cash

I agree. It is not so much a cc usage issue, but a matter of budgeting for survival after filing BK.

Stop using and paying the credit cards. Use the cash from not paying cc to pay for necessities.

If you find you have no money to pay for food, etc. after you have stopped paying the debt you are going to discharge, you need to postpone your filing until you can either trim your budget or get some more income into the household.

Filing BK will do no good unless you can survive on your household income post discharge.

[fltoo]

I'll let you know for sure after I file Times are really tough for me right now. My kids have to eat, I'm unemployed and have no medical insurance. I have a car in my name that I could sell to pay bills, but I'm scared THAT will raise a flag. Once I get a job and can support myself, I'll file, but until then I still have one card with available credit left and if my kids are hungry and I don't have money that week, I'm going to the grocery store and use that card. If I don't have the money to fill the RX for my blood pressure meds or put gas in the car, I'll use it.

If that CC issuer wants to dispute the charges for milk, bread, tuna, eggs and cereal, so be it...but I doubt they will. I have used that one card knowing I will be filing BK in the next 6 months or so. I saved the receipts so that I can prove I bought ground meat and chicken on sale and not lobster, shrimp or filet mignon, although that is probably not necessary. Is the aggregate amount I charged on that card for food more than $550 in the last 90 days? Yep. Do I intend on paying it back? If they challenge it, I will so yes, I intend to pay. I won't let my kids starve.

I don't think I would replace carpet or sinks though. Although I understand the OP's situation with the mold and all, I would just keep it to food, gas and prescription meds.

I'm ducking for cover now!!!! I confessed.

If you don't need the car and want to sell it, go ahead and do it.
As long as you sell it for market value and use the money for necessities, there is no problem with selling assets. Keep the receipts.

You are smart not to file until you are financially stable. Sounds like you are judgment/collection proof with no job. Don't worry about filing until you feel financially ready to support the household without credit.

[pcn]

Sorry, still confused. $600 outside the 90 day window? how far back? OR, $600 within the 90 day window. I took it as $600 within the window, and no more than $600 total to a single creditor. That was the consensus of several posts I've read recently, and my attorney's advice. I'd like to hear from someone who either:
a) had any credit use within the window
b) exceeded $600 within 90 days and "made it"
c) exceeded $600 within 90 days and got stuck.
I will call my attorney Monday and report back on his answer.

[hereforinfo]

I would say that tanning, eating out, and Gap clothes aren't neccessities and you really need to stop using your credit cards if you are planning to file bankruptcy. If you are desperate for groceries, that is one thing. But I would cut out ALL spending that isn't completely necessary.

[gogetter76]

Ok...so this should be it right?

Whatever day you file bankruptcy......go back the previous 90 days and not spend using cards...kinda like a ...back to the future... mentality.

[catleg]

I don't really understand the obsession about not using the cards. Honestly, if you still have credit available on credit cards, why are you even considering bankruptcy? Would you go hungry to save Chase or Citibank a few dollars?
I mean think about it people, you're worried about going before a US Trustee and maybe being asked about a dinner at Olive Garden, while these CEO's are going to Washington asking for handouts at the same time paying themselves millions in bonuses.