Judicious wait time btw stopping cc payment and filing

[strugglingda]

To build up some cash for the lawyer's fees and for surviving the "hard" times during the 60 month payment period, what might be a safe time period to wait between stopping all the cc payments and actual filing, safe from being sued by the cc companies? And the cash I build up, from reading the various threads, should not be in my bank account. Am I right on this? So should I keep it in the house under the mattress? Consistent withdrawal of cash from the bank account during that period, would that draw the trustee's attention once filed? Thanks.

[EricaCallaha]

If you are thinking of filing, I would stop paying soon. Anything paid to any one creditor within 90 days of filing that is over $600 is subject to question. Meaning that the trustee may make the creditor give all or some of it back. I would stop paying once you have talked to a few attorneys and have a handle on your situation. From a previous thread, I notice that you are unsure if you qualify. I would make sure that you qualify and then stop paying once you make your decision to file. Why give money to the credit cards when you are going to file bankruptcy? Plus, depending on where you are and your attorney.....many of the fees could be lumped into the bankruptcy petition. We had to pay the filing fees up front plus $50 and the rest is in the bankruptcy.

Credit card companies are so backlogged right now that it would take months and months for them to get you to court. We had a few cards that we had not paid in over a year and no threat of a lawsuit. Just be prepared for some nasty phone calls.

Good luck.

[strugglingda]

Thank you, Erica. About the phone calls, what's the prudent thing to do? Should they be answered or ignored? Are there legal consequences if you just ignore them? Also, once you stop paying the cards, the cash that ends up in your pocket, I assume you shouldn't keep it in the bank account. Do you do gradual consistent withdrawals? Is there a dollar limit of each withdrawal that should not be exceeded? Can you do this all the way up to filing and the payments start?

Sorry about all the questions. Thanks again.

[EricaCallaha]

Questions are what this forum is all about, so don't apologize. You are researching which most of the population doesn't do before making a great decision like this one.

About the phone calls: You can answer or don't. The decision is up to you. One thing that I would advise is not to tell them that you are filing bankruptcy. At least not until you have retained a lawyer. Even then, the attorney's office should tell you to forward all calls to them. After you file, you will have a case number that you can give out. We answered some and told them to call our lawyer. They will be really pushy about trying to get your plans out of you. DO NOT TELL THEM. Let your attorney's office handle it.

About Money: I would use the extra cash to save for an attorney, get things fixed around the house, get your car in super shape, build a little food storage, buy some new clothes, get things settled down for the long haul. You can do this pretty easily without raising any red flags. I would also start taking cash out when you go to the store and use the cash back method. Take out 60 bucks everytime you go. Put it in an envelope at home. Take the above actions and pay cash. On the day of filing we were told to have no more than $200 in all of our accounts. Well we had $1400 2 days before and we had to take it out and put it in other people's names so it wasn't technically "ours." We were moving, so we paid our deposit. We had $500 left over but it was in a money order that wasn't in our name so it wasn't an issue. We ended up putting it back in our account because we had nothing else to pay. We had a checking and a savings and we only had about $50 in each. No red flags from the trustee so far.

Also, stop using the cards immediately. Put as much distance between your last charge and filing as possible. Once you retain counsel, stop paying the cards. Or stop paying now. If you really think that you will file...why waste the money and the effort.

Good luck...I hope this helps.

[indebt00]

We are paying on a couple credit cardsthis month because we have more than $500 charged in the last 3 months. this is what our lawyer directed us to do. at least this month. we stopped paying all others this week.

[strugglingda]

Thank you everyone for the very useful tips. So once you file (or even before), your finances will be frozen for 5 long years, where you can't come up with any extra cash or do any "splurging" without catching the trustee's attention. Is this the right expectation? Erica, your words of "get things settled down for the long haul" sound a bit unsettling. But I guess this is the price you pay for getting into this financial bind, in many ways, a very small price to pay. Thanks again.

[EricaCallaha]

I just look at it as your budget is going to be tight. You probably won't be taking vacations unless you can do it on the chipper cheap. You will learn to splurge in other ways. By having some reserve you can replace a fridge that goes out or repair your car if something busts. 5 years is a long and short time to be in this. It is long when you are in it, but looking back 10 years down the road, you might begin to think that it wasn't so bad. But you are right, it is the price we pay for the financial bind.