When should you stop paying credit card bills

[gak555]

I am the person that started this thread and I appreciate
aa06a47's response. He hit it right on the button.

Sorry if I chose the wrong phrase when I asked about "pre-planning" a bankruptcy. When I took cash advances my purpose was to have them carry me until this great opportunity came through. At the time I had every intention of paying back my outstanding credit card balances and have in fact paid the minimums for two months The opportunity did not come through. Now, my back is against the wall I just want to minimize my penalties, etc.

No fraud intended.

[FoolAndHisMoney]

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!

If you were to keep paying until you file wouldn't this show the creditors & court that you can afford to keep paying and don't really need bankruptcy? You have to think this would be grounds to convert you to a chapter 13.

[djk]

If you were to keep paying until you file wouldn't this show the creditors & court that you can afford to keep paying and don't really need bankruptcy? You have to think this would be grounds to convert you to a chapter 13.

No, case in point, I paid full amounts to most of my creditors until the date I filed (1/13/2006). Two of my creditors were paid 1/2 the minimum in Nov & Dec of 2005. As a result a interest rate of 4% on each account went to the default of 30% and in addition the principle due increased to a minimum of 1% of the outstanding balance. Those two factors created minimum payments which increased the debt load beyond my ability to repay. The two creditors were not interested in any solution other than a 75% lump sum payment. The trustee asked me about the situation at the 341 and after I gave him this same explanation he stated he fully understood and wished me good luck in the future. That afternoon he entered into pacer that he had performed his duties in my case, there were no issues outstanding, and nothing to distribute to creditors and requested to be released fom my case.
Pacer now reports my case as "awaiting closure". In effect, I was discharged at my 341. My most recent credit report has all my creditors showing "included in bankruptcy" for all accounts. Like I said, I paid everyone some amount right up to the date I filed, 2 accounts showed 60 days, the rest paid as agreed.

[djk]

If you realize you are going to have to file bankruptcy, there is nothing wrong with planning to get the most relief from your bankrputcy. I don't thing ga took cash advances with the intention of filing bk. However, since he has taken them, he might as well wait at least the amount of time where they are dischargable.

If you do know your going to file bk, and take cash advances out, then yes you have committed fraud.

I don't think anybody on this thread should assume someone is guilty of fraud unless you know all the facts.

well there was also the issue of new employment for the stated reason of being able to fit under the median for the means test. so I guess the individual also has to wait at least six months with the new lower income so that kinda goes along with waiting that long so the recent cash advances can somewhat fade into the past. what I don't understand is if the great opportunity fell through and the back is against the wall why take a lower paying job just so that you fall under the median? why not look for another great opportunity? it is a planned event.

[queerguy]

great thread, very helpful, thx

I love getting all this advice for free.

[Rover]

Does anyone here have any proof or certain knowledge that there would be a dime's worth of difference between the credit score of (a) a person who paid their credit card bills faithfully up to the day they filed bankruptcy and (b) a person who did not pay any credit card bills for, say, six months to a year prior to the day they filed bankruptcy?

Once one files bankruptcy isn't that all that matters in terms of credit score? I can't believe that past payment patterns, chargeoffs, judgments, etc. for items that are dismissed in bankruptcy have much affect on one's credit score after filing bankruptcy.

Also, I've read that one's credit score actually goes up after filing bankruptcy because of the prohibition from filing again for 8 years (in the case of Ch. 7).

So, it seems to make sense to me that as soon as someone decides that they must file bankruptcy, they should stop paying everything except for essentials to maintain their home and any other assets they may want to keep.

It appears to me that much of the "advice" given in this thread is speculation and not based on fact. Can anyone prove that I am wrong?

[annikasaunt]

A little harsh there "Rover". The people who give advice on this forum have been there and done that. They are usually speaking from their own experiences and I find all their "advice" very helpful. Nobody is saying you have to take their advice. I have taken alot of it and found it to be very helpful. Nobody here is an expert in law, just experience! Take it for what it's worth or don't, that's your choice.

You can always do the research yourself and get back to all of us with what you find.

[aa06a47]

well there was also the issue of new employment for the stated reason of being able to fit under the median for the means test. so I guess the individual also has to wait at least six months with the new lower income so that kinda goes along with waiting that long so the recent cash advances can somewhat fade into the past. what I don't understand is if the great opportunity fell through and the back is against the wall why take a lower paying job just so that you fall under the median? why not look for another great opportunity? it is a planned event.

I think he stated "ancitpated" lower income, not let me go get a job at McDonalds so I flunk the means test.

I agree that I have saw some posters who are setting at home not working so they fall below the medium. I do not agree with that and feel that is being a bit shadey.

Unfortunatly, the new law extended that option to people, and quite frankly, encourages it. ....just think about it.... Don't work for 6 months, and we give you a chapter 7, or work, but don't make much more than minimum wage, or your in a chapter 13. ....Work, and we will put you in a chapter 13 for 5 years and you'll pay us every dime you have left over each month. Get a raise at work, send it in. Get an extra job to help get ahead...send it in.

Alot can happen in 5 years, so if your mom dies and leaves you her truck, tell the trustee, they want to sell it and take it.

Chapter 7, most folks are done within a year and done. If you could plan a little and get that vs 5 years of hell, wouldn't you?

If they didn't want people to avoid chapter 13, they would have given people a better option in chapter 13 than what they have. They could have made the chapter 13 easier.

Congress in there infinate wisdom, said lets punish the drug addict, the drug pusher is our friend and pays us money, so leave them alone.

So, if the new laws encourage people to plan a little better, then so be it, they are taking care of what they need to take care of. I don't have a problem with that. If I could have, I would have planned somehow to get into a chapter 7.

I'll get off my cross now, I figure someone else needs the wood.

[Rover]

A little harsh there "Rover". The people who give advice on this forum have been there and done that. They are usually speaking from their own experiences and I find all their "advice" very helpful. Nobody is saying you have to take their advice. I have taken alot of it and found it to be very helpful. Nobody here is an expert in law, just experience! Take it for what it's worth or don't, that's your choice.

You can always do the research yourself and get back to all of us with what you find.

Sorry, if I came across as harsh. I didn't intend to.

However, I got the feeling from reading the messages on this thread that much of the "advice" was speculation and not based on experience in this case.

I would think that it would be very difficult to know whether there would be a dime's worth of difference between the two scenarios that I described unless someone worked in the credit scoring industry. That's why I asked whether those who think that there would be were just speculating or knew for certain that there would be a significant difference.

Whether there is in fact a significant difference is very important to this discussion because if there is not, the way one would plan for bankruptcy might be quite different than if there were a significant difference. My gut feeling is that there would not be a significant difference. Therefore, I am still very interested in whether anyone who indicated in this thread that there is a significant difference has any concrete proof or experience that they could point to that a significant difference exists.

I'm just trying to find out what is speculation and what is indeed fact.

[scammer]

Does anyone here have any proof or certain knowledge that there would be a dime's worth of difference between the credit score of (a) a person who paid their credit card bills faithfully up to the day they filed bankruptcy and (b) a person who did not pay any credit card bills for, say, six months to a year prior to the day they filed bankruptcy?

Once one files bankruptcy isn't that all that matters in terms of credit score? I can't believe that past payment patterns, chargeoffs, judgments, etc. for items that are dismissed in bankruptcy have much affect on one's credit score after filing bankruptcy.

Also, I've read that one's credit score actually goes up after filing bankruptcy because of the prohibition from filing again for 8 years (in the case of Ch. 7).

So, it seems to make sense to me that as soon as someone decides that they must file bankruptcy, they should stop paying everything except for essentials to maintain their home and any other assets they may want to keep.

It appears to me that much of the "advice" given in this thread is speculation and not based on fact. Can anyone prove that I am wrong?

Rover,
This is exactly why I stopped posting, got tired of being called a "Fraud this, Fraud that". When in fact I was operating and utilizing the laws within the boundaries. My favorite was the poster that cut me down, then in a previous post, explains how they wanted to take a payday loan then bk within a week and walk from the debt, yikes!!! I asked myself, why post, what am I doing this for?? cause its cool?? nah. I deleted all my posts and enjoy reading all the speculation from the sidelines. Grow some thick skin, because any tactic that is sophisticated your going to be taking ground fire. I still enjoy reading once or twice a week, but nobody wants to hear from me. This is probably the reason other good posters disappeared too.

[Rover]

Scammer,

I would imagine that most people who post here have nerves that are pretty raw and on edge. I'm surprised that there isn't more tension showing up in the posts here.

I've been lurking for several months and just decided to start posting today when I had the question raised above.

However, once I got started posting, I couldn't stop.

[DisneyGirl]

Rover,
Short answer to your question is that both my husband's and my credit scores went up AFTER we cleared up all the "lates" that were posted in error. So they do have an impact. Not a huge one, but one none the less. It also helped that we continued to make all our car/van payments on time too. However I will say we didn't have the money for all this. We got in trouble because our CC debt was so high our minimum payments and regular bills ate up all our income. We used CC to buy groceries and gas just so we had the money from our paychecks to pay the bills! Awful cycle that I'm thankful to be rid of! Our trustee actually asked us about it. It was really the only question we got during the 341. He asked what our charges were and we said living expenses. He said, "okay" and that was it!

Anyway, I'm rambling now. I think it's totally an individual choice how you handle this. I wish you all the best!

[Bronte]

Rover,
I disputed some incorrect lates on my account (a total of 3) with Experian and once this was corrected my credit score went up 20 points. I know its not alot but I was happy with the results.

[Jenny]

"It's only after you lose everything that you are free to do anything" - Tyler Durdin

That's a dumb quote. If it were true, that would mean that homeless people have the most options since they have lost everything. It would make more sense to say that if you're a billionaire, you are free to do anything because you don't have to find a job to feed, clothe, and house your family.

[aa06a47]

Rover,
This is exactly why I stopped posting, got tired of being called a "Fraud this, Fraud that". When in fact I was operating and utilizing the laws within the boundaries. My favorite was the poster that cut me down, then in a previous post, explains how they wanted to take a payday loan then bk within a week and walk from the debt, yikes!!! I asked myself, why post, what am I doing this for?? cause its cool?? nah. I deleted all my posts and enjoy reading all the speculation from the sidelines. Grow some thick skin, because any tactic that is sophisticated your going to be taking ground fire. I still enjoy reading once or twice a week, but nobody wants to hear from me. This is probably the reason other good posters disappeared too.

Turn your font size down, people don't like being "screamed" at.

I think everybody (I know I am anyway), looking to get the most benifit from my bankruptcy. If you have any competative nature in you, you will want to "win" your bankruptcy case...for lack of a better word. People do fraud the system, I am sure my creditors will cry this on me even though it isn't true. Had I filed though the minute I knew I was bankrupt, I would probably get out of bk owing many thounsands of dollars.

I kinda remember some of your post, and your name if I remember was pretty much how you presented yourself.

Anybody with some good strategies should post. I for one, would like to hear any that can help me or someone else.