running up credit cards

[Peeps]

Admittedly, I ran up my cards and am now considering BK. There's a pretty sharp increase in my plastic-spending that definitely won't look good to a trustee. In my case, the spending was manic behavior associated with a little bipolar problem with which I seem to have been blessed. I'm hoping it won't look like fraud because that wasn't really the intent.

Anyway, I just wanted to toss that into the discussion because sometimes there are really some crazy reasons why spending habits fluctuate. I'm not looking forward to explaining it to a trustee but I figure the truth is probably better than letting the trustee make his/her own guesses.

[enuffznuff]

I think it's true that a lot of it is perception or trying to make it 'look better' (why people think saying "I'm a liar and cheat" looks better than saying "I am in over my head", I do not know, but they do).

I also think that people worry too much about some use, as someone else said, many people are using their cards to live on, and it accumulates to the point where even minimum payments become unmanageable, and you no longer have a Peter to rob to pay Paul. So if you charged gas and groceries, I don't think that's going to trigger an adversary proceeding or anything. But if you spent $500 at the Coach store and $500 at Bloomingdales...yeah you might have a problem. If you spent $500 at the eye doctor for your kids' glasses, probably not so much.

I also know several people who's mental health issues, such as bipolar or compulsive shopping or gambling led them to the spot they're in. Unfortunately stress often triggers the behavior, so an 'uptick' in it close to filing wouldn't be unusual. As long as you're now in treatment for the issue, it seems unlikely to cause a huge problem.

JMO, I'm not a lawyer.

[bcohen]

Generally speaking, the Trustee (and the credit card companies) are looking for purchases of non-essential luxury items in the months leading up to bankruptcy. For example, if someone purchases a plasma TV or laptop or jewelry and then files for bankruptcy soon after. If you are simply using the credit card(s) to pay for normal living expenses such as groceries, prescriptions, gasoline, etc, there will not be a problem.

In any case, most bankruptcy attorneys would advise to quit using credit cards as long as possible before filing. I believe that 6 months is adequate, but I am not an attorney, so don't take this as legal advice.