When should you stop paying credit card bills

[gak555]

Again,
Like many of us I am pre-planning a chapter 7. Right now everything is current, but that will change. How many months before filing for bankruptcy can I safely stop paying my unsecured credit card bills, etc.

[aa06a47]

Again,
Like many of us I am pre-planning a chapter 7. Right now everything is current, but that will change. How many months before filing for bankruptcy can I safely stop paying my unsecured credit card bills, etc.

Most people will tell you at the point you know your going to file for bk, to quit paying the creditors. Why throw money away so to speak. Use the money your not paying to the creditors to pay your lawyer.

[gak555]

That makes sense. Let's say I am going to file 6 months from now to allow time to pass for cash advances and also with an anticipated decrease in income to get below the state's median income requirements. If I stop paying the unsecured debts that far in advance could it complicate things with lawsuits, garnishing wages, etc.

In other words, by stopping 6 months in advance as opposed to let's say 3 months in advance am I causing myself more problems than it is worth ?

[Bronte]

I would not stop paying bills that far away from the bankruptcy date. You could be sued, wages garnished and the account could be charged off. I stopped paying mine after I meet with the bankruptcy attorney and knew I would file in a week or so.

[aa06a47]

I would, (and I know of no legal basis for this, just my opinion) continue to pay the minimum's on credit cards where the cash advances were taken. I would make those payments until you get at a minimum past the 70 days since the last cash advance. I think this will show intent to pay them back.

My personal experience, the cc companies started calling me almost immediatly after being late. Now, how long between an actual law suit and garnishment, who knows, I figure it varies between credit card companies. I think you might get a few lawsuits by waiting 6 months, however, if so, you can file at that time and won't really be any worse off. It is up to you and how much you can take.

[BassBoy]

I would not stop paying bills that far away from the bankruptcy date. You could be sued, wages garnished and the account could be charged off. I stopped paying mine after I meet with the bankruptcy attorney and knew I would file in a week or so.

Bronte is right. Once you know you're going to file, then you can stop. If memory serves me correctly, once we retained our atty, filled out our petition, it was about 20 days and we were filed.....so.....a month or two of missed payments shouldn't complicate things.

[annikasaunt]

I have a couple of accounts where I have missed 4-6 months of payments. They just kept calling and calling and calling! Once I paid the atty in full he told me to stop paying them and to tell them to call his office. That was about 3 weeks ago and I did get a couple of calls which I refered to his office, but I haven't heard form anybody else yet. I think the atty's office sent out letters regarding the BK so they won't call me. Why pay the creditors when it will all be discharged in the end, hopefully! Use that money to catch up on utilities, phone, dr's appts, car repair, etc...

[Rona123]

Something else to keep in mind if you're considering stopping your CC payments is that your credit will take an additional hit over and above filing for BK. BK will, of course, lower your credit score, but if you still have a decent credit score right now but then start showing as 30, 60, or 90 days late prior to filing, then your score will start dropping even before you file. The higher you can keep your score before you file, the higher it will be after you file, and the easier it will be to rebuild credit post-discharge. Just a thought.

Good luck!

[DisneyGirl]

Something else to keep in mind if you're considering stopping your CC payments is that your credit will take an additional hit over and above filing for BK. BK will, of course, lower your credit score, but if you still have a decent credit score right now but then start showing as 30, 60, or 90 days late prior to filing, then your score will start dropping even before you file. The higher you can keep your score before you file, the higher it will be after you file, and the easier it will be to rebuild credit post-discharge. Just a thought.

Good luck!

ITA! This happened to us. Our atty told us to stop paying the month we retained her NOT when we actually filed. Now we have 30 and 60 day lates in addition to the BK. I say if you can afford it and like Rona123 says, your credit score is still decent, keep paying until you file.

Good luck!

[annikasaunt]

I could not afford it. I have been getting caught up on my utilities, etc and I was actually able to go to the dentist for the first time in a long time. Of course it cost me alot, but if I was still paying the cards I would have never been able to go.

My bk is just from plain stupidity topped off with appliances going in the house, topped off with the higher interest rates and payments. I really hope the court does not hold it against me!

Going thru all this gives you a big lesson in finances, thats for sure!!

[Rona123]

Annikasaunt,

If they held bad financial decisions, bad luck, and bad timing against us, no one would ever be able to file for BK! Fortunately though, we've all been there, so we can all relate.

I was very fortunate in that I was able to keep up my CC payments until I filed, but that was because I had huge student loans that were about to go into repayment. I could pay one or the other, but not both, so I timed my filing to take place before I had to pay my loans, but while I could still pay my credit cards.

Ron

[time4cake]

I don't understand this belief that a high credit score is something we as bankruptcy filers desire. Isn't credit what got us here in the first place? Or, is a high credit score like a report card? Do we attach our self worth to this number? I just don't get the fascination.

My goal in bankruptcy is to come out the other side with as many assets in tact as possible, credit score be damned.

[BassBoy]

Something else to keep in mind if you're considering stopping your CC payments is that your credit will take an additional hit over and above filing for BK. BK will, of course, lower your credit score, but if you still have a decent credit score right now but then start showing as 30, 60, or 90 days late prior to filing, then your score will start dropping even before you file. The higher you can keep your score before you file, the higher it will be after you file, and the easier it will be to rebuild credit post-discharge. Just a thought.

Good luck!

I would have to agree with Rona on this one. Recently, we were able to get a new cell phone plan (cheaper plan) and we were instantly approved, NO DEPOSIT, and I found out our credit wasn't all that bad. My point is that we kept up the payments until we retained our atty and we would be filed within a few weeks, plus, our credit wasn't that bad before the BK.

[annikasaunt]

I'm not concerned so much with my credit score. I just want to be able to breathe a little easier everyday! I felt like I was suffocating with all the cc bills I had to make. Life will be so much more enjoyable after this is all done and over with!!
I've got plenty of time to rebuild my credit...but I am also ok with the thought of paying cash for the remainder of my life!! It feels good to know something is paid and done when you use cash!

[LostOne0069]

I don't understand this belief that a high credit score is something we as bankruptcy filers desire. Isn't credit what got us here in the first place? Or, is a high credit score like a report card? Do we attach our self worth to this number? I just don't get the fascination.

My goal in bankruptcy is to come out the other side with as many assets in tact as possible, credit score be damned.

I agree with you here and had actually started to post a similar statement... but then thought about the fact that I WOULD like to buy a house again someday... and a new car when the current one wears out... etc. etc.

I NEVER plan on having a credit card balance again. EVER. So as far as that goes I don't care if my FICO is 0... but I'll need a bit higher FICO when I want to go find a home for my family.