Getting into credit card debt is very easy. It usually happens over time before you realize that you are in financial trouble. It can happen with or without a financial crisis such as unemployment, medical emergency or the loss of a spouse. In some cases, it is just a simple case of failing to manage finances wisely.
Regardless of the reason why you are in credit card debt, bankruptcy may be able to help you resolve the problem. Bankruptcy is intended to give a debtor a fresh start so that the debtor can recover from financial problems. Bankruptcy law does not judge why a debtor is in financial trouble nor does it prohibit a debtor from receiving debt relief simply because the debtor is at fault for the debt problems. However, this does not give the debtor the ability to run up credit cards with the intent of filing bankruptcy.
If you intentionally run up your credit cards immediately prior to filing bankruptcy, you could be charged with bankruptcy fraud if it was your intent to defraud your creditors. Furthermore, charging luxury items immediately prior to filing bankruptcy can result in that debt being excluded from your bankruptcy discharge. For example, if you purchase a jet ski a month prior to filing bankruptcy by charging the purchase price on a credit card, that creditor can file a motion with the court to exclude that debt from your bankruptcy discharge. In other words, you would still be responsible for the jet ski debt even though you filed bankruptcy.
Not all charges are “luxury” items. If you have charges for food, gas or other necessary living expenses on your charge card immediately prior to filing bankruptcy, those charges may still be eligible for a bankruptcy discharge. Bankruptcy law does not define “luxury items” but you would have a better chance of arguing successfully before a judge that charges for groceries and gas to get to work were not luxury items than you would arguing a jet ski was not a luxury item.
Discharging Credit Card Debt Through Bankruptcy
Even though you may be able to discharge some charges on your credit card that are made within a few months of filing bankruptcy, it is always better to stop using your credit cards as soon as you realize you have a debt problem. If you cannot afford to pay the minimum payments on your credit cards, you should stop using them and consult an experienced bankruptcy attorney. In most cases, you can file bankruptcy to discharge your credit card debt so that you can recover from your financial problems and begin again with a clean slate.
Contact an Experienced Mount Holly Bankruptcy Attorney
Personal Approach, Professional Service, Affordable Payment Plans
The Law Office of Travis J. Richards, LLC is a full-service Mount Holly bankruptcy law firm focused on Chapter 7 Bankruptcy, Chapter 13 Bankruptcy, debt consolidation, credit repair, tax liens, student loans and foreclosure. We represent clients in Burlington County and throughout South Jersey.
Contact our office at 609-267-5297 to schedule your free consultation to discuss bankruptcy and non-bankruptcy alternatives. You may also use our convenient online contact form and one of our friendly, professional staff members will contact you to answer your bankruptcy questions and/or schedule a free consultation with Travis J. Richards.
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