Credit Advice Before Bankruptcy

Contrary to popular belief, most bankruptcy cases are not the sole result of overuse of credit cards. While credit card debt is among the easiest to have discharged in bankruptcy, one of the main concerns debtors face when filing is related to their pattern of credit use prior to filing.

Timing Is Everything

Credit debt is among the top sources of debt brought into a bankruptcy case. However, there are instances in which people have found these debts to be ineligible for discharge. This is generally the result of overuse of credit cards within the months leading up to filing. Debt accumulated within the 90 days prior to filing for bankruptcy may not be eligible for bankruptcy. Further, you may be asked to give up these items to satisfy the debt.

Why? These actions could be seen as suspicious or even fraudulent by the court.

Imagine if everyone could rack up big ticket purchases of thousands of dollars in nonessential or luxury items and then have the debt resolved by paying little in return, or nothing in some cases. This would be considered abuse of a financial system designed to help those in need during a tough time. Therefore, there are guidelines that the bankruptcy court follows in order to ensure that people are obtaining a fair chance at help.

If you are considering filing for bankruptcy or have any questions about your credit usage, don’t hesitate to contact a Tampa bankruptcy lawyer. They can help ensure that your credit card history does not hinder your path towards becoming debt free.



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