My husband and I have been thinking about filing chapter 7. I was recently told that there is a new law in Washington state that you can't claim credit cards when you file chapter 7. Is this true?
2007-03-02 10:34:49 · 5 answers · asked by invictus 4 in Business & Finance ➔ Credit
YEs it is true
and it is not just in washington it is all over the nation.
Law just changed at the start of 2006. (strong credit card lobby in congress was tired of this loophole).
If credit cards are the only basis for filing, then you should try to work out a payment plan
2007-03-02 10:41:34 · answer #1 · answered by Anonymous · 0⤊ 0⤋
There are new federal and state laws that have gone into effect in the fairly recent past. Not being able to file against your credit cards would defeat the whole purpose. Most creditors don't even show up for your hearing unless the amounts you owe are enormous. If you own real property and have other assets you really need to speak to an attorney. Many, many will talk with you for free and give you the legal answers that are correct. Chapter 7 really improved my life, and the consequences are not as bad as the things you hear. Remember, once the case is discharged, your debt will be virtually zero. Many companies think that makes you an OK risk.
2007-03-02 18:47:46 · answer #2 · answered by gervoi 3 · 0⤊ 0⤋
Probably not. Bankruptcy is federal law. States dictate how much you can write off, however, especially home equity and luxury items.
The bankruptcy court look VERY carefully at all assets, income, etc. Any charges made within 90 days of filing are automatically considered suspect and can easily be disputed by the credit card companies. They also specifically ask if you have given anything away in the last year.
A good place to start is hummingbirdcreditcounseling.org. This organization is non-profit and they do not sell anything. They are an approved educator for most bankruptcy court districts, and they can refer you to the sites that will list exactly what can and cannot be discharged in a bankruptcy. You can take the first part annonomously and it is free, in addition to being very helpful.
2007-03-02 18:42:20 · answer #3 · answered by jimmyjohn 4 · 0⤊ 0⤋
Yes, I believe you'd have to declare a different code to get credit card absolution. See, the reason a lot of those laws are changing to not include credit cards is that you generally can't repo stuff bought on a credit card. So, because of that, some people honestly don't care, run up the credit cards to buy whatever they want and then declare bankruptcy to get the big ticket items for free! Sad isnt' it? I"m sure that's not the case with you but if it is, you'd have to do a different kind of bankruptcy, not sure what that one is and it's more severe, it's not the same 7 year duration.
2007-03-02 18:40:46 · answer #4 · answered by ? 2 · 0⤊ 0⤋
I'm not sure about the specifics of Washington state bankruptcy laws, On October 17, 2005 the Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA) went into effect. This legislation was the biggest reform to the bankruptcy laws since 1978. The legislation was enacted after years of lobbying efforts by banks and lending institutions and was intended to prevent perceived abuses of the bankruptcy laws.
Chapter 7 essentially simply allows a court-ordered restructuring. You'll still have to pay the debt.
2007-03-02 18:45:24 · answer #5 · answered by Richard H 2 · 0⤊ 0⤋