Credit card debts are among the easiest to wipe out in a bankruptcy. It doesn’t matter if you are current on your payments or things have gotten so bad that you are being garnished for a credit card debt. Filing a bankruptcy immediately stops a credit card company from making nasty collection calls, filing a law suit or garnishment. If you are making payments on credit cards and have decided that you want to file bankruptcy for sure, you might as well stop making the payments because bankruptcy discharges interest and late fees. You can not pick and choose which credit cards to discharge and which to keep. You must include all your credit cards in bankruptcy. You will have to rely on a bank debit card after filing your case, at least for a while. If you hire our firm we will take the collection calls for you while you get ready to file bankruptcy.
The only way credit cards will not be discharged in a bankruptcy is if you commit fraud. Fraud involves making charges on the card in anticipation of filing bankruptcy. If you know that you are going to file bankruptcy and you make a lot of luxury purchases or take out big cash advances right before you file, you will probably be in trouble. Fraud can also involve filling out a false credit application. A creditor has to prove fraud in a separate lawsuit that is tied to your bankruptcy called an adversarial proceeding. This case is difficult to prove and requires hiring an attorney so creditors are careful about filing the case.
They usually make their decision to file the adversarial proceeding based on how much was charged and how soon the charges were made before filing. If you’ve only made a few small charges for necessities just before filing, the creditor probably won’t bother filing an adversarial proceeding. If you have made some large charges, it would be smart to make a few payments and wait a while before you filed even if you did not intend to commit fraud when you made the payments. Defending an adversarial proceeding can be expensive even if you didn’t intend to commit fraud.