Richfield, UT asked in Bankruptcy and Banking for Utah

Q: If I stop paying my Credit Cards because I know I'll be filing Chapter 7 in a few months. What do I do with extra cash?

For my unsecured debt, the minimum payments are $1200 a month. If I stop paying them because I plan to file what am i expected to do with the excess money. I, of course, will need some to live on and but will probably have $500 leftover. I image if I put that in my mattress it will need to be accounted for eventually. What If I pay extra on Student Loan or put it in a ROTH IRA? I want to play by the rules, but don't want to just throw money at debts that will be discharged anyway.

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3 Lawyer Answers
Cristina M. Lipan
Cristina M. Lipan
Answered
  • Bankruptcy Lawyer
  • Brooklyn, NY

A: You can exempt certain assets. If you have enough exemptions to cover that extra cash it's not a problem what you do with it, it's yours. To be safe, just don't take too long to file your bankruptcy case so you don't accumulate so much.

Timothy Denison
Timothy Denison
Answered
  • Bankruptcy Lawyer
  • Louisville, KY

A: Use it to live on and claim an exemption for the balance.

Bruce Alexander Minnick agrees with this answer

Bruce Alexander Minnick
Bruce Alexander Minnick
Answered
  • Business Law Lawyer
  • Tallahassee, FL

A: All of these important questions can only be answered by a bankruptcy lawyer hired BEFORE you attempt to file for bankruptcy.

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