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do you have to included all credit cards in BK

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I plan on filing Chapter 7 and my question is do I have to inlcude all of my credit cards? I have Best Buy and Firestones cards with low balances that can be paid off since I won't be paying on the other cards. I also have a BofA credit card and this is also where my checking is and even though I have a 1300 balance I would like to keep it and pay it off also with the extra credit money.

I am currently paying on 13 credit cards and I have not been late on any of them but I am having to use them to survive. Also I am really not looking forward to the harrassing creditor calls but I am hoping that I can have the money to the attorneys by mid-November and I will begin to stop paying my credit cards in October.

Any advise you can offer will be greatly appreciated.

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Any card with a balance must be included in the bk.

Spoken from the other end. Credit cards, home equity lines and personal lines of credit that are paid off, $0 balance do not have to be reported. Unless you have a balance to repay, they are not creditors.

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I have a very small amount that I owe on my Best Buy card. If this is paid off prior to the attorney filing my bankruptcy, do you think that they will still close the account?

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do you think that they will still close the account?

Yes, they will. HSBC (the ones that back the Best Buy card) are unforgiving and will close your account so fast your head will spin.

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If I understand this correctly, I should not waste my time trying to pay them off. I was really trying to keep this card in case of emergency.

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If I understand this correctly, I should not waste my time trying to pay them off. I was really trying to keep this card in case of emergency.

Prob a waste of time and money to pay them off. You can always just call and ask them if you want to know for sure.

-r

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What could I ask them? I would really like to keep this card, but I don't waste my time and and money paying them off only to have them cancel the account.

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I had an HBSC card that I had never ever been late on - had a zero balance when I filed BK7 - and they still closed it. On one of my reports, besides a IIB comment, they also said 90 days late - I got HBSC to change that part to "never late".

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Paying off credit cards before you file is a fruitless exercise. Most creditors will close accounts even if you owe them NOTHING. In essence, you're throwing your money away.

Get away from the idea of using a credit card for 'emergencies', this is a very bad mindset. Save some CASH out of every paycheck and put it in a savings account that you DO NOT TOUCH unless it's for an emergency. Everyone needs an emergency fund equal to at least 6 months of expenses plus a bit more for those unexpected auto repairs etc.

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Everyone needs an emergency fund equal to at least 6 months of expenses plus a bit more for those unexpected auto repairs etc.

Although this appears a good idea on it's face, it isn't. You should have a savings account equal to your highest insurance deductable you may pay, a separate one for medical expenses (preferably a pre-tax account), a pre-tax account for college savings if you have children, and throw all other savings into an IRA or 401k plan.

The reason for this is that IRA and 401k plans are totally off-limits to creditors, whereas money markets and bank savings can be seized. As we all know here, creditors --especially collectors -- sometimes use the courts in a deceptive manner to get judgments without the consumer knowing. Having 6 months worth of money sitting in an account they can touch is just asking for trouble. In an IRA (and most 401k) you can make a withdrawl as long as you put it back within 90 days with no tax penalty. And if it is such an emergency that you must take out funds, then you're not going to care about the 10% tax penalty if you are unable to put it back in 90 days.

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If she's filing for bankruptcy, a savings account AFTER bankruptcy can't be touched by anyone !

I think it's ridiculous not to have some liquid cash in the bank and the mindset of relying on a credit card to get thru 'emergencies' post-bk is the wrong mindset to have -that's NOT living within your means. The 6 months number is actually low, because it may not be enough if you lose your job these days.

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If she's filing for bankruptcy, a savings account AFTER bankruptcy can't be touched by anyone !

How long do you think it would take a BK lawyer and judge to retrieve funds that have been siezed wrongly in a post-bk scenario? Or to unfreeze an account? I don't know about you but having money missing or locked up for months while the legal systems sorts it out isn't a very palatable option. Yes you will get it back, eventually. But can you afford to let something like that happen?

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...(and most 401k) you can make a withdrawl as long as you put it back within 90 days with no tax penalty. And if it is such an emergency that you must take out funds, then you're not going to care about the 10% tax penalty if you are unable to put it back in 90 days.
Many 401ks allow you to borrow from it for a longer period of time than 90 days for ANY REASON and pay yourself back with interest. Usually this is set at or above prime rate to discourage self-banking. But there are no tax penalties for this type of 401k loan. So don't withdrawal- borrow. If you default on your payment obligation later, then it just becomes a withdrawal at that point and the 10% penalty kicks in on whatever balance is not paid.

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Ok, so you're saying you would NEVER have a savings account because some boogey-man creditor might come out of the woodwork with an illegal judgment or seizure ?

That's just a little too paranoid for me. My point stands - relying on CREDIT post-bankruptcy for 'emergencies' is just the wrong mindset. I don't care if you keep it in a cookie jar, but SAVE !

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Ok, so you're saying you would NEVER have a savings account because some boogey-man creditor might come out of the woodwork with an illegal judgment or seizure ?

That's just a little too paranoid for me. My point stands - relying on CREDIT post-bankruptcy for 'emergencies' is just the wrong mindset. I don't care if you keep it in a cookie jar, but SAVE !

LadynRed and I met {in the cybersense} about 01ish on a site called freeadvice.com.

Over the years, our paths have crossed on several bk forums. Of the many thousands of posts I've seen on those sites, the only garnishment instances have been where a turnover order was in the works before the bk was filed and the creditor didn't get a timely notice. The issue seems to have been resolved in a few hours once everyone concerned got a fax from the debtors lawyer with the filing number and the threat to file a complaint over a violation of the automatic stay if the funds weren't returned immediately. Creditors dropped it like a hot potato.

Yes, I have bank accounts and no, I've no fear that they'll be seized. Noway I'll use my 401K like an ATM machine.

The bk filing is the easy part. What comes next is a lot tougher. Fixing the issues that brought you to bk. And, that starts with be able to pay cash for the minor unexpected expenses life throws at you and not depending on a cc to get by.

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The bk filing is the easy part. What comes next is a lot tougher. Fixing the issues that brought you to bk. And, that starts with be able to pay cash for the minor unexpected expenses life throws at you and not depending on a cc to get by.
Well stated. Filing the paper was easy but stressful. The years that follow require the real effort for many (myself included in this camp).

There are some however, that are in BK because they are uninsured or underinsured and had a medical crisis, not because of any behavorial flaw on their part.

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Well stated. Filing the paper was easy but stressful. The years that follow require the real effort for many (myself included in this camp).

There are some however, that are in BK because they are uninsured or underinsured and had a medical crisis, not because of any behavorial flaw on their part.

I'm a week away from the 2 year anniversary of my filing. Once I was discharged, I went out and got a better paying job. Then, about 3 months after I started my new job, I picked up some pt work-working overnight at a major retailer 2 nights a week. Nothing solves financial problems like more money.

If uninsured medical issues were the problem, you need to try and find a job that offers group health insurance.

I'm pretty hardcore on this issue. Nobody should go through all the hell of a bk and then settle for the status quo. No more living paycheck to paycheck. If you don't materially improve your situation post bk, the bk was just wasted. Nothing is too extreme and all options have to be considered.

We had quite a discussion about this on another site. A couple of members decided that the underemployment problem wasn't going to get any better and they relocated far from family and friends where jobs were more plentiful.

Keep in mind, budgeting and living below your means are important. I clip coupons and have a written budget but, that only takes you so far. Inflation will eat you up if you can't increase your income.

My standard advice post bk is, a better job with a benefit package that includes health insurance as well as long and short term disability policies. Max out your 401K. Auto insurance that conforms to state law and, a homeowners/renters policy.

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Ok, so you're saying you would NEVER have a savings account because some boogey-man creditor might come out of the woodwork with an illegal judgment or seizure ?

Not at all. I just limit savings in non-exempt account types to the highest insurance deductable I may have to pay out. If my largest deductable is $1000, then I keep that amount in a general savings account. I keep a general checking account for regular expenses and everything else goes into an IRA.

As for the boogey-man...Well, there are a lot of disreputable businesses out there and a lot of legitimate circumstances that coudl wipe out all your savings. Unless you live under a rock, you will encounter one eventually. It is royally foolish to leave yourself with such a large financial exposure that can be exploited. You could get sued tomorrow for being liable in an automobile collision, or have massive uncovered medical expenses from falling down some stairs. Once you incur a huge liability it's too late to move your savings because you will be accused of fraud yourself. You have to have everything protected before you incur a liability to ensure it is kept safe.

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I got to admit that a dose of paranoids is a good thing these days...

In the same vein that "If it sounds to good to be true, it probably is." you have to be prepared for "If it sounds so bad it would never happen to me, it just might."

I'm a belt AND suspenders guy myself...I have some money in a savings account (a couple of months worth) and I put the rest into my 401k.

You need medical insurance to keep you alive and life insurance just in case the first one doesn't work...

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