Question Should I wait to call a lawyer? Need legal advice asap.

[trueblues]

Hi, I'm new and have searched but can't find the answer to my question. Thanks for your help and for bearing with me. I know this is long.

Basically, does contacting a bankruptcy lawyer soon after charging a large amount raise a red flag? I honestly didn't consider BK until this weekend when I faced the fact. I'm in deep trouble.


Some background: I lost my job in January, never saw it coming. In December I started having a lot of necessary dental work done. Told the total cost would be approx. $13,000. I charged the first payment of $3,300 and made an appt. for the rest of the work. The very same day of my appt., I was told I was being let go. I had 10 temporary teeth, I had to finish the work. I charged the final installment in mid-February, $13,800 on four different CCs.

I was already $40,000 in CC debt. Long story. I'm married but my husband and I have always had separate credit cards and checking accounts. We live in a community property state. He's made a few payments for me since I lost my job but has his own CC debt, I would guess about $50-60,000 and says he can't help me with my bills anymore. He doesn't want to file BK, he has a good credit score and needs access to a CC for work. He wants me to file alone.

I need to ask a lawyer for advice soon because I'm now eligible for unemployment benefits. My window for filing is April-June. I'll get $140/week which will put us $80/month over the 6 month means test if I file for UE in April. I know they'll consider his income even if I try filing separately, but I really need some spending money soon. I'm desperately looking for work but there's nothing out there.

I just missed my first CC payment on a card not used for the dental work. I'm out of money. I have $500 cash left to put towards a lawyer. My husband said he'll help pay for legal help at least.

Should I put some more distance between that big charge in Feb. and contacting a lawyer? I'll lose my unemployment benefits but I'm afraid they'll think I had no intention of paying which isn't the case.
I did use a CC in March - $160 for haircut, kids' clothes, cleaning supplies, cat food. It wasn't a card I used for the dentist.

Thanks so much for your help.

[justbroke]

First, you should always put distance between large "luxury goods and services" purchases and filing. This is because, by operation of law, they are presumed to be non-dischargeable anyhow!

As to contacting a lawyer... it could only be construed that you knew you were insolvent when you made the charges if you contacted the lawyer before you made the charges. That has been the only case in which I've seen this blow up in the debtor's face. If you contacted the lawyer after, then you have no issue with constructive fraud.

Regarding those specific charges, since you say they were medical, and I assume not cosmetic (e.g. not elective, as you had a bonafide medical reason to have the procedure done), then you will have no issue with having charged the services.

I don't think you have any issues with contacting a lawyer to prepare for bankruptcy. you now know that you're insolvent, but didn't know before. Of course, you thought you'd have work by now. But, given the climate and job losses nationally, it looks like you won't be able to pay.

[trueblues]

Thanks, justbroke. The dental work wasn't elective, I had severe gum disease and bone loss and had to have all my upper teeth pulled. I could've gotten removeable dentures for less money but my dentist told me it would be a terrible choice, that my bite would be off and I should get a permanent denture connected to four implants. So I went that route. The removable denture and teeth removal surgery still would've cost about $8,000.

I hope they don't argue that I could have made the less expensive choice. It was on my dentist's advice.

I'm very relieved. I'll start looking for a lawyer now.

[OhioFiler]

I'm intriqued by the separate lives a husband and wife can live. I've never considered my wife's income hers nor my income mine. We have shared income and shared debts.

[trueblues]

Yeah, I'm sure it seems odd to many people. But over the years I've learned that there's more folks in a similar situation than I would've thought. We don't know what goes on in others' marriages, or why.

[BornAgain]

I'm intriqued by the separate lives a husband and wife can live. I've never considered my wife's income hers nor my income mine. We have shared income and shared debts.

Yep. If getting married isn't "throwing in together", nothing is. Yet I knew a couple that kept everything separate -- including the vacations! Didn't last.

[trueblues]

Again, thank you justbroke. I appreciate that your reply was pertinent to my question.

[justbroke]

Again, thank you justbroke. I appreciate that your reply was pertinent to my question.

I tend to be verbose at times, but I try my best to answer the question. I hope that you find a similar answer from your attorney.

[albacore44]

First, you should always put distance between large "luxury goods and services" purchases and filing. This is because, by operation of law, they are presumed to be non-dischargeable anyhow!

As to contacting a lawyer... it could only be construed that you knew you were insolvent when you made the charges if you contacted the lawyer before you made the charges. [B]That has been the only case in which I've seen this blow up in the debtor's face[/B]. If you contacted the lawyer after, then you have no issue with constructive fraud.

Regarding those specific charges, since you say they were medical, and I assume not cosmetic (e.g. not elective, as you had a bonafide medical reason to have the procedure done), then you will have no issue with having charged the services.

I don't think you have any issues with contacting a lawyer to prepare for bankruptcy. you now know that you're insolvent, but didn't know before. Of course, you thought you'd have work by now. But, given the climate and job losses nationally, it looks like you won't be able to pay.

Just curious, but did this persons Lawyer turn them in or something ??

[keepmine]

If a creditor files an adverserial proceeding to challenge the discharge of a debt-that will be one of the first questions asked. If you ran up a bunch of debt after you talked to a lawyer the inference will be the lawyer told you the debt was unsecued and could be discharged.
I agree with Justbroke seeing a lawyer after using the cards is no issue since nobody will regard an extensive dental procedure as a luxury.

[justbroke]

Just curious, but did this persons Lawyer turn them in or something ??

As keepmine wrote, this will generally come out during either the pre-trial deposition or other discovery in the Adversarial Proceeding / Complaint to determine Non-Dischargeability. The Creditor will ask when you retained or consulted legal representation. Pretty easy to determine that, and then know that they had proper legal advice and still decided to charge up debt.

For those who are interested, here's the relevant caselaw that I rely upon... In re Dougherty, 84 B.R. 653 (Bankr. 9th Cir. 1988). In Dougherty the Bankruptcy Appellate Panel for the Ninth Circuit set out twelve nonexclusive factors to be considered in determining the debtor's intent. One of them is...

Whether or not an attorney had been consulted concerning the filing of bankruptcy before the charges were made.