I Just Maxed Out my Credit Card, Should I Wait to File Bankruptcy in New York City?

When you are underwater on your finances and the creditors come a knocking it can sometimes be hard to make the right financial decisions.   Under intense pressure some people take desperate measures that can hurt their future ability to eliminate debt through bankruptcy.  If you are considering bankruptcy the best thing to do before making any financial moves is to consult a bankruptcy attorney in New York City.  To qualify for bankruptcy there are certain requirements made on your recent financial history, and generally speaking maxing out a credit card right before bankruptcy is usually a bad idea if the purchases were made for luxury items or things not necessary for your day to day living.  If you are using the card for regular expenses there won’t typically be an issue, but if you max your credit card out on luxury items or take a large cash advance right before filing bankruptcy then you could be doing yourself more harm than good.

Our clients that have maxed out credit cards aren’t necessarily trying to pull one over on the bankruptcy court.  With the thought of losing future credit it can be easy for someone to try to get as much out of their credit lines before filing bankruptcy.  If you have done this or are considering doing so it is usually in your best interests to speak to an attorney who can help you find the best solution to your problem before filing bankruptcy.  Generally speaking if you have waited 90 days to file bankruptcy from your last luxury goods purchase or cash advance you should be in the clear on getting a discharge from these debts.  If you purchased luxury goods or took cash advances on a credit card (not debt card) a creditor may try and show that you had no intent to pay for the luxury goods and that the card should be non-dischargeable.  With the help of a qualified attorney this will be difficult for them to prove if the charges were outside of 90 days, but every situation is different.

As a law firm we cannot legally advise you to incur more debt before filing for bankruptcy.  Maxing out credit cards right before filing for bankruptcy can complicate the process, but it does not automatically disqualify you from bankruptcy relief.   Realize there are other ways to get the financial help you need, and that your available credit is just one of many things your bankruptcy attorney will consider when advising you on your bankruptcy needs.   If you live in New York City and need immediate relief from your debts please contact the Law offices of William Waldner online or at 212.244.2882 to arrange a free consultation.  We only practice bankruptcy law and maintain a 99% Chapter 7 discharge record in New York City as of 9/31/16.

This article is intended for educational purposes only.  By reading this no attorney-client privilege has been created.