If you have been considering filing for bankruptcy and have credit cards there are several things you need to know about the use of them in the months leading up to the filing date. Some people think they can just run up the limit on their credit cards and get away with it. This is not true and is considered bankruptcy credit card fraud.
When filing for bankruptcy it is important to use you credit cards as little as possible, preferably not at all. If a person uses more than $500 of a credit line for any reason within 90 days of filing for bankruptcy the debt may not be dischargeable. Additionally any purchases that are considered a luxury during the 90-day (or even 180 day) period leading up to the filing date would be considered bankruptcy credit card fraud. Another thing you will want to avoid during this time is wire transfers of funds using your credit cards within this period because it can not only be considered bankruptcy fraud but also fall under fraudulent funds transfer laws.
When you think about it logically if you are filing bankruptcy you a saying to your creditors as well as the government that you are not able to pay your debts, so why would you add more debt to the pile that you cannot pay? Obviously, filers are given some leeway in that you can use small amounts for necessities for daily life such as food or rent, however a LCD TV or major electronics would most certainly not be a need.
Finally, it is important to remember that bankruptcy credit card fraud even when not intentional cannot only jeopardize your debits being discharged in your filing it can also lead to criminal charges in some cases. So always, remember to not charge anything to a credit card if you do not have to absolutely do so. This is because you will have credit card records of all this activity. I suggest using cash as much as possible until your case is discharged.
Moreover, if you need to by things on a credit card, that you do not want the courts to know about, you should used a secured card that does not report your activity to a credit bureau. Yes, this is tricky, but it is up to you what you decide to tell the courts, I am not telling what to do. Life does go on after and during bankruptcy, and the need for a credit card is one of those things you will want.
