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Questions about credit card usage pre-filing/pre BK decision

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    Questions about credit card usage pre-filing/pre BK decision

    We have been kicking around the idea of me filing BK since October 2008. My husband's business picked up though not long after, and I was working, so we shelved that idea and continued making payments each month.

    He had me quit my part-time job in June 2009 so that he could concentrate on his business. My being at work was taking away time for him, and being that he was/is definitely the higher earner, it made more sense for me to be home with the kids so that he could devote all possible time to work.

    Right after Thankgiving 2009, business took a dive. Income in December was something like $4k. January was also dismal, February wasn't looking much better until the very last couple days of the month. March was better, and so far so good for April. (knock wood, thank You Lord). Even with business being better, we are still not up to par -- our gross this year is about $8k less than last year for the same period. Of course costs stay the same/have gone up!

    We trucked along, paying cash for most everything (including Christmas gifts) and keeping the bills up, even though it was tough.

    In January I called Chase's hardship dept and was approved for a better plan on a long-closed card, the one with the highest balance. That card has been closed for about 3 years, so of course it hasn't been used for that long. Have been making the payment as agreed, until last month, when I missed the first one.

    I have another card with Chase, which I used now and then for a variety of things. The last time I charged anything on it was last week, to order an item for the baby and a gift for my son, the amount was I think about $35-$40. I am current on the card payments, and plan to make them up until I file.

    Also have an AMEX. In February I accidentally made double payments of $294 each. Ouch. That hurt us financially as far as reducing cash on hand. To make up for that cash loss, I did a huge grocery shopping trip at Walmart, had oil in a vehicle changed, and did some smaller trips to Walmart -- all groceries/ household items; definitely no luxury or "big ticket" purchases. My last charge on that card was March 7th. When the payment came due the next week, I was unable to make it. My payments were $588, the charges totaled $858. Obviously I am not going to be using the card again.I made a "token" payment though of $18. (Yeah, I know, worthless in their eyes).

    Discover - My last charge was to Radio Shack in December 2009. I made payments as indicated until missing March's. I did make a token $10 payment this month.

    FNB - This was a balance transfer card. I never ever used it until I made health insurance premium payment for 2 months, in February. I made March's payment, but will miss this month's.

    Bank of America -- I used the card in January at Walmart for $42. I just checked, and dental insurance, which is paid 4x/year, is about to post, for $270. I am current on the card and intend to stay that way until I know when I am filing, mostly b/c even though I have been removed from the 2 checking accounts there, I am afraid of them taking the money anyway.

    So, looking at all this info -- is there anything bad, anything that can cause me trouble at filing in, say, June? (At the earliest, probably July is more likely).

    Thanks.
    Filed 5/31/11 341 & Report of No Distribution 7/28/11 Discharged & Closed!! 9/29/11
    "What I won't accept or buy any longer is that my credit score defines who I am. Screw that."

    #2
    Hi NP. I'm married and am filing by myself for CH 7. I made a couple purchased/cash advances in Feb. of this year on a couple cards. They weren't large purchases/advances. My understanding you shouldn't be using cards for at least 90 days before filing. I will be filing before the month is out as I finally have all my necessary docs and my taxes are done.

    Good luck.

    Comment


      #3
      Probably no problems. Just make sure that you stop using them.
      All information contained in this post is for informational and amusement purposes only.
      Bankruptcy is a process, not an event.......

      Comment


        #4
        Your big issue is that you have to find a way to stop using them now. That means it is better to not pay the cards than to make a minimum payment and then charge something. And I know that making the decision to not pay even when you have the money is really really hard. But to stop using cards (and you most certainly will have to once you file!) you need some reserves.

        Also move your checking to a bank you don't owe money to.
        12/2009 Stopped paying CCs; 3/10 1st suit;
        8/2010 finally served; No Asset 7 filed. 11 mos since last bal xfer
        9/22/10 60 day club; 9/24/10 report of no distr; 11/23/10 DISCHARGED

        Comment


          #5
          The general rule is that when you decide to file BK--and it sound like you are thinking strongly about it--is that you stop using the cards, and stop paying on them. Use the money that would have gone to payments for saving up to hire an attorney, unless you feel confident enough to do it yourself (filing pro se).

          Also use some of the money that you are saving to create an emergency fund. There is a current thread on that subject elsewhere. Purchase storable food or houshold items that you know you will need and be using such as soaps, shampoos, paper towels and toilet paper, etc. You will find a lot of suggestions throughout here.

          Good luck to you and your family.
          "To go bravely forward is to invite a miracle."

          "Worry is the darkroom where negatives are formed."

          Comment


            #6
            I decided almost last minute to file so I used a couple cards (lightly ~$500 on one and ~$250 on another) up to about 25 days before filing. Not a peep from any of them.
            Filed Chapter 7: 10/29/09 341 Meeting: 12/02/09
            UST involved: 12/12/09 UST out: 1/10/10
            Last day for objections: 2/01/10 Discharged: 2/8/10

            Comment

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