Lots of Gambling debt, anyone else?

[inseriousdebt]

I know that I was a careless individual for this to happen to me through gambling a ton away and using my credit cards for this as well.

I am trying to find out if anyone else on this site has a similiar story...gambling debt..lots..and is now in bankruptcy mode? or have you already gone through bankruptcy with gambling debt?

I am in great need of advice on what to do. Is this looked at horribly by the courts..or the same as any other issue like cumpulsive shopping? Will I be able to file bankruptcy and get through it without it being dismissed? what are the chances? I am super confused and cannot waste my time paying a lawyer thousands if I know this won't help me.

[down @ out]

Gambling Debt

I am assuming you used your credit cards to obtain cash advances for money to play.

First off the issue of intent is very importent. As a gambler your intent obviously was to win and therefore pay the debt back. You need to keep this in mind. Even if you were nuts to believe you would win and pay it back it makes sense to someone with this problem. I know.

Next look at the whole issue of dischargeability of credit card debt and see how your situation fits in. A good article to look at is dcba.org/brief/juneissue/1998.

Also get yourself into a gambler`s anonymous program now. You need to do this for yourself but you also need to demostrate sincerity if the issue comes up downstream. That is be able to show the court you are trying to fix the problem.

Next if you get to the 341 hearing make sure you get in on the record that a major reason you are there is gambling. That needs to be in the record.

When I went through this mess I was as ready as I could be an low and behold none of the credit card companies even showed and my cash advances were very close to the petition date. Here in Nevada it is a big problem.

Seriously get some help also with the gambling problem. GA is a good program and take in seriously. Whether or not this is a problem in the bankruptcy or not it is a life issue.

Also take the time to search the internet for articles on bankruptcy and gambling. A number of bankruptcy courts let bankrupts slide on this issue if you adopt some of the above strategies. CC Companies may raise hell but be honest and say as crazy as it is you thought you would win and pay it back. That way they cannot prove your intent was to defraud them.

Good Luck, it is a rocky trail you are on.

[keepmine]

Gambling debt is routinely discharged. Nothing really new under the sun. See an attorney and get all of your options explained.

http://www.dcba.org/brief/decissue/1999/art21299.htm

[Pinktiger]

I don't agree that it necessarily needs to be on the record at the 341 hearing that gambling debt is a primary reason for a person's situation. Gambling was a part of my problem, but only a part. A larger part was due to unemployment and underemployment, and my husband's early retirement, heart condition, and high medical costs. At my 341 hearing nobody asked me how I got here. I got the feeling the trustee didn't give a damn one way or the other; he was primarily seeing if
(a) my debts were legally dischargeable; and
(b) if I had any assets he could grab.
Many of the trustees are nasty, mean, ill-tempered individuals. I wouldn't give one any ammo for making you feel bad. They can do that without your help.
Unless more than $1000 in cash advances are within a 120-day or 90-day window of your filing date, you are probably OK.
If not, you should wait to file until they are.

[Pinktiger]

Another thing: GA is a great thing, and I'm not knocking it, but it isn't the only way to stop gambling. Gambling addiction is harder to break than alcohol, drugs or even smoking. (Smoking is next to worse.)
If you have an urge to gamble, you need to replace it with something else. The way GA works is, it replaces the urge to gamble with a reliance on a higher power and the group. If GA is not for you, or it isn't available where you live, you need to find a way to replace the gambling with another activity that you enjoy. You should also go easy on yourself. Gambling is cunning and powerful. It will grab you when you least expect it. You are not to blame - it is a disease.

[aa06a47]

I don't agree that it necessarily needs to be on the record at the 341 hearing that gambling debt is a primary reason for a person's situation. Gambling was a part of my problem, but only a part. A larger part was due to unemployment and underemployment, and my husband's early retirement, heart condition, and high medical costs. At my 341 hearing nobody asked me how I got here. I got the feeling the trustee didn't give a damn one way or the other; he was primarily seeing if
(a) my debts were legally dischargeable; and
(b) if I had any assets he could grab.
Many of the trustees are nasty, mean, ill-tempered individuals. I wouldn't give one any ammo for making you feel bad. They can do that without your help.
Unless more than $1000 in cash advances are within a 120-day or 90-day window of your filing date, you are probably OK.
If not, you should wait to file until they are.

Here is another interesting artical...

http://www.usdoj.gov/ust/eo/public_affairs/articles/docs/gambling.htm

In another recent case, AT&T Universal Card Services v. Crutcher, 215 B.R. 696 (Bankr. W.D. Tenn. 1997), the debtor suffered from a severe, diagnosed, gambling addiction resulting in an $11,885.75 cash-advance balance on her credit card. Eleven months after her latest gambling spree, the debtor filed bankruptcy. The court, using a subjective approach, "including the reality of the debtor's addiction," focused on the intent of the debtor to repay her debts and found the credit card debt dischargeable. The debtor's good faith belief that she could repay her debts and her history of doing so supported the discharge of the debt.

[aa06a47]

I don't agree that it necessarily needs to be on the record at the 341 hearing that gambling debt is a primary reason for a person's situation. Gambling was a part of my problem, but only a part. A larger part was due to unemployment and underemployment, and my husband's early retirement, heart condition, and high medical costs. At my 341 hearing nobody asked me how I got here. I got the feeling the trustee didn't give a damn one way or the other; he was primarily seeing if
(a) my debts were legally dischargeable; and
(b) if I had any assets he could grab.
Many of the trustees are nasty, mean, ill-tempered individuals. I wouldn't give one any ammo for making you feel bad. They can do that without your help.
Unless more than $1000 in cash advances are within a 120-day or 90-day window of your filing date, you are probably OK.
If not, you should wait to file until they are.

I think it is important, because in some cases, they (trustee and credit card company)are going to want to know where the hell all that money went. I think being able to proove your gambling addiction will help clear the way for a fresh start.

Pinktiger, when your a chronic gambler, I know, I am one, you don't go into court with the medical bill problem, the lost job problem, alot of issues that generate mercy from the courts.........you go in oweing many thousands of dollars, I read one case it was over 200K, mainly cash advances and NO assets to speak of to explain what you did with all that money. So, in my humble opinion, the trustee does need to know, and people like me need to go in there with the statements to prove the gambling losses..

BTW, the new law is if anything over $500 and 70 days for cash advances. As I have learned on this web site, the burdon of prove lies with the cc company's after the 70 day period...they might still win, some cc companies go back and try to prove fraud, but they have to prove your purchased things without intent to pay and that is difficult. I'm also told, much anything over 6 months, and the cc companies won't even bother....but some will actually fight 12 months.

[down @ out]

Gambling and Bankruptcy

From what I have read and my own personal experience getting the trustee on board at the 341 hearing as to what caused the bankruptcy, gambling debt, is good for several reason. It shows you are being honest enough to admit to a serious problem and helps explain how you got into this mess. Also helps answers questions as to where all the money went. Also it gets it into the record so that downstream if a cc company files an adverserial proceeding you can use your statements to show that you are not just surfacing the argument at the adverserial hearing to get off.

Once a cc company hears the problem they know you have a defensable position and their ability to get you to pay them becomes more difficult.

At my 341 hearing the trustee was very appreciative of me fessing up, seemed happy I was in gamblers anonymous. I have no doubt the confession helped the whole process go a lot smoother.

Good luck

[Pinktiger]

All good points. I stand corrected. I was just speaking from my own experience. When the trustee, at my 341, noted I had $16,000 in gambling losses on my 2004 tax return, he sneered and said, "How much have you lost this year?"
He was a snarky creep.

[inseriousdebt]

creditors?

Well, we are going to wait 6 months. We are sitting at right around 105,000 grand on our credit cards from cash advances from this. We also had a few cash advances to pay bills and so forth. Errr...such a mess in the end, but I know I brought it on myself.

The articles you have sent are great, and I will be doing more reading on them today.

To all of you whom have made it through with gambling debt, did any creditors come after you in your 60 day waiting period? I am afraid that if this happens, I will not have any money left to pay for this in addition to my lawyer in the beginning of the filing. Are they trying to make you settle on an amount or to actually pay the whole thing back?

[keepmine]

If by come after you do you mean a lawsuit?
Likely not until after chargeoff. Suing is an expensive way to collect. If per chance they sue, be sure your lawyer knows about any judgment. That gets discharged as well.
You may want to start talking with some lawyers and get a feel for the way trustees in your district handle this stuff.

[aa06a47]

Well, we are going to wait 6 months. We are sitting at right around 105,000 grand on our credit cards from cash advances from this. We also had a few cash advances to pay bills and so forth. Errr...such a mess in the end, but I know I brought it on myself.

The articles you have sent are great, and I will be doing more reading on them today.

To all of you whom have made it through with gambling debt, did any creditors come after you in your 60 day waiting period? I am afraid that if this happens, I will not have any money left to pay for this in addition to my lawyer in the beginning of the filing. Are they trying to make you settle on an amount or to actually pay the whole thing back?

I am 14 days past due on one of my credit cards, and they have called me 30 times now. I finally answered the phone and told them I couldn't pay the amount they wanted. Another one has been calling and I haven't answered them. They sent me a letter (I am 25 days past due on them). I don't have the money to pay them, so guess I might not make it the 6 months.

In a chapter 13, it will depend on how much you can pay back. The court will decide this for you. I'm sure that if your somewhat making the payments now, your income will be such that you will be chapter 13 under the new law. If your like my circumstances, your payments will double / tripple/ quadroople/ or more when they raise your interest rate. After the first month of missing a payment, the snowball starts down the hill. The credit cards you have with low interest will suddenly raise to 30%. Get ready for a ride, and it won't be good. Talk to a laywer (but don't pay one a retainer yet unless your at least 70 days past your last cash advance) It is my understanding that the day you retain the attorney is the date that the court uses to determine if you committed fraud as far as the time period goes.

Note, you mentioned a 60 day waiting period. Under the new law, it is 70 days.

[BKSorrow]

Gambling becoming an issue during our BK

We also have a large gambling debt. Some of that is in the form of unpaid casino markers. We discussed the problem with our lawyer and everything was included in our filing. It wasn't until our 341 meeting that it became an issue. Our tax returns included "Gaming income". We play slots and any one win in the excess of I think it's $1,250 requires them to issue you a tax form before they pay you. The trustee wanted copies of all our casino win loss statements so we provided them and then went to our 2nd meeting. At this one along with the original trustee there were 2 people present from the "US BK court" they had all sorts of questions regarding our debt. Gambling was not a big issue in our credit card debts. A win/loss statement for a slot player can look worse than it really is. For the non gaming trustees it's hard to understand that a gross loss of let's say $100,000 (ours is much higher) does not mean that you actually put that much of your own cash into the machine. Either since we couldn't answer all there questions off the top of our heads, (they asked questions that I would have to pull out 3 years of credit card statements to answer, which by the way they already had copies of) they want another meeting in 2 weeks. And the original trustee also wants to see copies of all our mortgage documents. I don't know what one has to do with the other. In our case we did gamble alot but our win/loss was pretty equal we didn't incure a lot of debt to it and we told them that most of the gambling was from more than a year ago. We are just 2 people who's income has been cut due to the current economy and housing slump and have fallen behind on our payments in the last year.

So let me tell all you gamblers, depending on what trustee looks at your file I honestly feel they put a red flag on you to begin with. If our credit card statements showed lots of recent cash withdrawals or something then I would understand but thats not the case.

They have me so worried with all this additionally requested mortgage stuff that I may be one of those people who just walk away.

[BKSorrow]

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