Do you have to file bankruptcy to get rid of credit card debt?

Do you have to file bankruptcy to get rid of credit card debt?

By filing a Chapter 7 bankruptcy case, you can get rid of credit card debt while protecting your property. However, you need to qualify for Chapter 7 by having income that is below the average median income in your state. Written by Attorney Jonathan Petts.

How does Chapter 13 bankruptcy work for credit card debt?

In very few cases does a Chapter 13 debtor repay 100 percent of his or her credit card debt. In most cases, the debtor pays a small percentage of the credit card debt to his or her creditors. Once the debtor completes the Chapter 13 plan, the remaining credit card debt is discharged. Chapter 13 bankruptcy can only help if you complete the plan.

Can a credit card company object to a bankruptcy?

If you used the credit card to pay for debts that you could not typically get rid of in a bankruptcy case, that debt won’t likely get erased. For instance, if you use your credit card to pay child support, alimony, back taxes, or student loans, the credit card company may object to your discharge.

Why is credit card debt not dischargeable in Chapter 7?

Two reasons why credit card debt may not be dischargeable are: If you use your credit cards to charge $675 or more in “luxury” goods or services within 90 days of filing your Chapter 7 petition, the court may find that the credit card debt is non-dischargeable.

When to stop using credit cards before filing Chapter 7 in?

Let’s Summarize… It’s time to stop using your credit cards once you know that you’re going to file Chapter 7 bankruptcy and at least 90 days before filing, if possible. You can’t max out credit cards before bankruptcy just because you’re about to file.

When to max out your credit cards before bankruptcy?

Here are the rules: If you use your credit cards within 90 days before filing bankruptcy for luxury goods and services aggregating more than $725, fraud is presumed (as of April 1, 2019; $675 for cases filed between April 1, 2016, and March 31, 2019).

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