JasonS68

@bingo: But how could it possibly be proven that it was run up for the purpose of filing bankruptcy? Like I said, my credit accounts, etc. are in good standing so, at this point, I'd just be putting an addition on my home.

I guess my question is whether it COULD be excluded. For instance, if the money was from a personal loan from a small local bank instead of credit cards, could the bank appear in bankruptcy court and argue that the equity in the home is directly from their loan (assuming it wasn't actually a personal loan NOT secured by the property) and should be exclude from the homestead exemption? I know they COULD, but has anyone ever heard of anything like this, and do you believe it would have any chance of success?

I planned on continuing to pay my mortgage and thus keep my house.

I do have available balances on credit cards, and all of my credit, payments, etc. are current, so I am certain I could use them to pay for improvements. "cover the entire current mortgage + improvements"? I'm not sure exactly what you mean. If the house is currently worth $200,000 (and outstanding mortgage is $200,000), but after improvements is worth $225,000 with $200,000 mortgage, that would leave me with $25,000 equity - which presumably would be exempt under the homestead exemption. Am I missing something?

I have a (somewhat) curiosity question concerning the homestead exemption in Chapter 7 bankruptcy in Pennsylvania. I have a home with no equity, but I have a lot of credit card debts and am considering filing Chapter 7. If I have an addition constructed on my home (Increasing the home value by say $25,000) and pay for it by credit card - and then wait 6-12 months before filing Chapter 7, can I claim the $25,000 as Homestead Exemption and discharge the debt even though that $25,000 is part of the debt to be discharged? Does anyone know of a statutory reason I couldn't do this? Are bankruptcy judges allowed to make "judgment calls", or do they go strictly by the statute? Thanks for everyone's thoughts.