Have you recently taken out a loan or used your credit card to stay financially afloat? If so, you may be wondering if it's too soon to talk to a bankruptcy attorney. The good news is that you can seek legal advice within 90 days of incurring debt.
Many people find themselves in a tough financial situation and turn to loans or credit cards as a temporary solution. However, it's easy to fall behind on payments and realize that the debt is becoming unmanageable. If you're in this situation, it's important to know that seeking help from a bankruptcy attorney is not a sign of failure.
By talking to a bankruptcy attorney, you can explore your options and find a solution that works for you. Bankruptcy can provide relief from overwhelming debt and give you a fresh start. Don't let the fear of judgment hold you back from seeking the help you need.
When Should I Stop Using Credit Cards and Getting Loans?
When considering filing for bankruptcy, it's best to stop taking on any new debt as soon as possible. There are several reasons why you should avoid filing for bankruptcy with recent debt.
Firstly, any new debt you incur within a certain period of time before filing for bankruptcy may not be eligible for discharge, meaning you would still be responsible for paying it off even after bankruptcy. This is known as the "presumption of abuse" period, which is typically 90 days before filing.
Secondly, taking on new debt before filing for bankruptcy may be seen as an attempt to defraud creditors. This could result in your bankruptcy case being dismissed or even facing legal consequences.
Lastly, continuing to accumulate debt while considering bankruptcy may indicate that you have not fully addressed the underlying financial issues that led to your decision to file for bankruptcy in the first place. It's important to address these issues and work towards a more stable financial future.
Bankruptcy Fraud and Recent Debt
If you're considering filing for bankruptcy, it's important to know that taking out new debt with the intention of erasing it through bankruptcy could result in accusations of fraud. In fact, creditors may even file lawsuits against you within the bankruptcy case to prevent recent debts from being discharged.
Additionally, incurring new debt with the goal of eliminating it through bankruptcy could lead to penalties from the bankruptcy court. It's crucial to be transparent about your financial situation and not try to manipulate the system for personal gain.
While bankruptcy can provide relief for those struggling with debt, it's important to approach the process with honesty and integrity to avoid any legal consequences.
Recent Debt: Cash Advances in Anticipation of Filing Bankruptcy
If you're considering filing for bankruptcy, it's important to know that cash advances over $1,100 with a single creditor within 70 days before filing are considered non-dischargeable. This includes credit card cash advances and payday loans.
If you've taken out a recent cash advance like this, the creditor has the option to file an adversary proceeding to object to the discharge of the debt. This is essentially a lawsuit filed within your bankruptcy case. It's then up to you to prove that the debt should be discharged. The bankruptcy law assumes that you intended to file for bankruptcy to get rid of the debt.
It's worth noting that creditors can still file adversary proceedings for cash advances that are older than 70 days. The only difference is that the creditor would need to prove that you took out the cash advance with the intention of filing for bankruptcy to erase the debt.
Recent Debt: Credit Card Purchases and Filing Bankruptcy
When it comes to credit card purchases and bankruptcy, there are some important things to keep in mind. If you make luxury purchases over $800 from one company within 90 days of filing for bankruptcy, these purchases are considered fraudulent. In this case, the credit card company can file a complaint objecting to the discharge, and you'll have to prove that the debt was not fraudulent to avoid owing the money.
But what about purchases that aren't luxury items? Generally, credit card purchases that were not for luxury items within 90 days of filing for bankruptcy are considered unsecured debts and can be discharged. However, if the creditor can prove that you made those charges with the intent of never paying the debt because you intended to file for bankruptcy, then the court may agree with the credit card company.
It's important to note that credit card companies can file an adversary case for any amounts incurred within 90 days of filing bankruptcy or outside of the 90-day period. However, when it comes to non-luxury purchases, the credit card company has the burden of proving fraud.
So, what does this all mean? If you're considering filing for bankruptcy, it's best to avoid making any luxury purchases over $800 from one company within 90 days of filing. Additionally, be cautious about making any purchases that could be seen as suspicious, such as "stocking up" on essential items before filing for bankruptcy. By being aware of these rules and regulations, you can navigate the bankruptcy process with confidence and avoid any potential legal issues.
Bottom Line – You Can Meet with a Bankruptcy Lawyer With 90 Days of Getting a New Loan or Using Your Credit Card
When you're struggling with debt, it's common to use credit cards or take out loans to cover living expenses. Seeking legal advice about bankruptcy laws is perfectly legal, and can be helpful if you're having trouble making ends meet. However, if you're planning to file for bankruptcy, your attorney will likely advise you to stop using credit cards and taking out new loans.
Unfortunately, many people find it difficult to pay off their loans and credit cards while also covering living expenses without using credit. It's important to be transparent with your bankruptcy lawyer about your debts and how you incurred them. Your attorney will review your debts to determine if any are non-dischargeable or considered fraudulent or abusive.
Timing is also important when filing for bankruptcy. Your attorney can help you come up with a strategy that avoids the presumption of non-dischargeability. They may also advise you to stop paying certain debts so that you have enough money to cover living expenses. While this can lower your credit score, you can work to rebuild it after bankruptcy.
REMEMBER: Being honest with your bankruptcy lawyer is crucial to avoiding problems with your case.
An experienced bankruptcy attorney can usually find solutions to issues they know about before filing. However, if you hide recent debt after your case is filed, it limits what your attorney can do to help you. So, honesty is the best policy when it comes to bankruptcy.
We Can Help You Find a Bankruptcy Lawyer In Your Area?
Are you struggling with debt and considering bankruptcy? We can connect you with a bankruptcy lawyer near you who offers free consultations. Plus, with our bankruptcy lawyer fee calculator, you can easily view estimated fees for bankruptcy attorneys in your area.
Don't hesitate to reach out to us with any questions you may have. Our team is always available to chat, answer your questions, and help you make an informed decision about your financial future. Let us help you find the legal advice you need to get back on track.
We Can Also Help You Explore Non-Bankruptcy Alternatives?
We understand the burden of debt and our goal is to help you achieve financial stability. The good news is that most of our services are free of charge. We offer a fresh start by providing options for getting out of debt.
If you're unsure about your options, our free bankruptcy and debt relief calculators can help you compare them. Additionally, our Savvy debt payoff planner is designed to help you pay off debts quickly and affordably.
Don't hesitate to reach out to us for a free case evaluation. Our team members are compassionate, friendly, and knowledgeable. They work with you to determine the best way for you to get out of debt and build a sound financial foundation for your future.