Credit Card Debt
Bankruptcy is a very good way to relieve you of your credit card debt. Some credit cards are “secured,” which in a bankruptcy can also be either discharged or paid back for pennies on the dollar. Credit card debt is considered a unsecured debt — which means the creditor does not have a lien on your personal property. This is the type of debt that a bankruptcy is best used for. Also, you may have other unsecured debts which a bankruptcy can also relieve you of.
The attorneys at Lynch Law Offices, P.C., can help you explore your options for discharging credit card debt and other types of debt. Our team of credit card debt attorneys in DuPage County has extensive experience handling Chapter 7 and Chapter 13 bankruptcies for clients in Lisle, Wheaton, Naperville and across the Greater Chicago area.
If you file for Chapter 13 rather than Chapter 7, you will have to pay back some portion of your unsecured debts — usually less that 20 cents of what you owe over five years. Also, any unsecured debts that remain will be discharged.
Rarely, credit card companies challenge the discharge of debt owed to them, by claiming that the debt was fraudulently charged by:
- Submitting a fraudulent application
- Using the card without any intent to repay the debt
In deciding whether credit card debt was “fraudulent,” a judge will consider:
- The length of time between the charges and the bankruptcy filing
- Whether or not an attorney was consulted before you charged the debt
- The number of charges you made
- The amount of the charges
- Your financial condition at the time you charged
- Whether the charges were above your credit limit
- Whether you made multiple charges on the same day
- Whether or not you were employed
- Your employment prospects
- Whether there was a sudden change in your buying habits
- Whether the purchases were luxuries or necessities. Luxury goods over $500 purchased within 90 days of filing cannot be discharged in bankruptcy. Nor can cash advances of more than $750 taken within 70 days of filing.
If you have run up your credit cards in the two to three months prior to filing for bankruptcy, it is likely you may have to pay a portion of the debt. It is best to have the help of a Naperville credit card debt lawyer to better understand your rights and options.
We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.