Seeking Clarification on the 70/90 Day Rule

[danaf]

I've read a lot of threads and understand it's best to wait as long as possible before filing, esp. if there are some large charges.

My question though is -

70 days and $750 in cash advances.....does this mean $750 or more?

90 days and $500 in charges....does this mean $500 or more?

So if the amounts are less than the above the 70/90 rule doesn't matter?

And this is supposed to prevent fraud? I think this is nuts. I've got tons more credit left. I could still charge up a storm, and still wait out this 70/90 day rule. I wouldn't do that because I don't want to raise any red flags. I know people that would though and not think twice about it, their reasoning being that if they are going to claim ch 7, they might as well do it with a bang - esp. if they are able to.

[lrprn]

My question though is -
70 days and $750 in cash advances.....does this mean $750 or more?

Yes, anything $750 total and above during the 70 days before filing.

90 days and $500 in charges....does this mean $500 or more?

Yes, anything $500 or more. Also the focus tends to be on whether the charges are for non-necessity (luxury) items.

So if the amounts are less than the above the 70/90 rule doesn't matter?

These limits are the guidelines suggested by the Oct 05 bk law - under these levels is considered reasonable, over is considered grounds for further investigation. However, there's always exceptions. If your trustee sees other signs of potential abuse in your case, then he/she can start looking closely at everything around your finances back for a year or more up to five years. If he/she finds more than $500 charges or more than $750 cash advances spent for normal things like groceries, kids' school supplies, diapers and formula for your child, etc chances are all will still be ok. However, if the recent charges are for luxury items, then it definitely won't be ok.

And this is supposed to prevent fraud? ... I know people that would though and not think twice about it, their reasoning being that if they are going to claim ch 7, they might as well do it with a bang - esp. if they are able to.

A debtor can *try* to get away with anything they think they can. However, if caught, the bk court system takes fraud VERY seriously. It isn't worth the risk to try to put one over on the federal government. If you're caught, you could end up in prison AND all your debt listed as a part of the case can never ever be discharged.

[Keebler]

Sorry to split hairs but this has always bothered me. I'd appreciate any clarification...

70 Days for cash advances. $750 maximum is the maximum total of everything from all sources added together over the entire 70 Days?

90 Days for purchases. $500 from all sources total over the entire 90 Dyas? Or, $500 mximum for any single creditor? Or, $500 maximum from any single transaction?

Is it really safe to stop making payments for 90 days to be sure there's enough money to avoid charging?

Early on I thought I might get a big cash advance and use it to make my minimum payments for several Months. Then, when the advance was all spent I would file. Unfortunately, there's really not enough credit left for me to pull it off any more.

[SinkingFast]

The 70/90 day rule is "Line of Credit by Line of Credit".

Say you charge $500 on Chase, another $200 on BoA, and another $300 on Citi. It's all good. Citi isn't gonna come after the $$$'s you charged on Chase or BoA.

Same thing with Cash Advances. Line of Credit by Line of Credit. You could have 3-4 outstanding Cash Advances with 3-4 Lenders, and the Lender will not pool their complaints against you.