Is It True I Will Owe Credit Card Debt After Bankruptcy?

The answer is, in almost all cases, no

The answer is, in almost all cases, no. There are only a few limited exceptions to the rule that unsecured credit cards are discharged in bankruptcy. Even though creditors may tell you otherwise, they are usually wrong, and most of the time they are just trying to get you to pay a debt that legally you have no obligation to pay.

Sometimes creditors will tell you that it doesn't matter if you file bankruptcy because you will still owe the credit card after your case is over. This is almost never the case. It is true that you can sometimes agree to pay the debt, by signing a reaffirmation agreement, but most of the time these credit cards are not repaid. Usually, reaffirmation agreements only apply to secured debts, like those which have property for collateral like a house or car.

If you pay your taxes with a credit card then normally you are not going to be able to discharge the credit cards in your bankruptcy. This does not happen very often. Also, if you have made charges on your credit card and obtained the credit through fraud, this would not be discharged. Finally, if you have charged more than $600 for luxury goods or services in the 90 days prior to filing, this would not be dischargeable in most cases.

Actually, the good news is that your credit card debt will be gone in a bankruptcy almost always. Creditors to tell you this is not true or simply trying to get money out of you. The best thing you can do if you file bankruptcy and you have question about whether or not you still a credit card debt is to check with your attorney.

Frequently, consumers want to keep a credit card or "save" a credit card and not list it in their bankruptcy. The reason that they want to do this is so that they will be assured of having a credit card after their bankruptcy is filed. They are afraid that because of the bankruptcy filing they will not be eligible for a new credit card. While this was never actually true, it is certainly not true today.

Consumers are able to get credit cards as soon as they have filed their bankruptcy. Actually, we know that consumers get lots of offers of new credit right after their bankruptcy is filed. Creditors understand that these consumers no longer owe all of the debt that they used to owe. Therefore, they are actually better credit risks having filed a bankruptcy than they were before.

by: Richard West

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