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  1. #1

    Default How are Luxury Items Treated in Bankruptcy

    My question involves bankruptcy in the state of: CA

    I have several questions that I am trying to get some info on, so sorry for posting so many new threads, but I think it's better to separate them by individual issue/questions, rather than trying to get them all answered in one gigantic post.

    Anyways, I have some questions about "luxury" items. A large portion of my credit card debt comes from purchasing luxury items. I purchased one item almost 2 years ago, and another approx 1.5 years ago. From what I understand, these charges are old enough that they won't really be looked at. Or, are these charges going to be heavily scrutinized in BK court or by the trustee? I read that only luxury items purchased within the last 60 or is it 90 days that may be construed as fraud, and anything older than that, as in my case, won't affect anything.

    Am I right?

    Also - If it makes any difference on the luxury items mentioned above, I was out of work during the time I made both of the charges, but was looking for work. However, I had prepaid/booked both items when I was still working and had no intention of losing my job. It was because the place I worked at went out of business, which was no fault of my own. But, I did technically quit even though the place closed their doors a few weeks later, which I knew about ahead of time.

    However, a few months later after incurring the charges for the luxury items, I developed a bad hernia and became severely debilitated. Of course, I did not have any insurance because they want an astronomical amount for just myself (like $1000 a month b/c of "preexisting conditions" which are a bunch of BS, but nevertheless it gives them an excuse to rape on med ins.) So I had to have an emergency hernia surgery, and I was not physically able to work for several months. I had to pay cash for this surgery, and is NOT part of my debt, BTW, I paid it in full at the time of surgery. (they would not finance it, since I went to a private hospital, b/c I had too much debt and a low credit score)

    Also, during that time there were a few months that I tried to be self-employed, which failed miserably. So I guess for a short time during those months I was technically "voluntarily unemployed" if you will.

  2. #2
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    Default Re: How are Luxury Items Treated in Bankruptcy

    There are limits to the property that is exempted from bankruptcy.

  3. #3

    Default Re: How are Luxury Items Treated in Bankruptcy

    Well, these were for "non-tangible" things, so there is no way to extract any value from them. What's ironic is that I would have used the cash that I had to pay for my emergency hernia surgery .. to pay my debts. Instead, now I have hardly any cash left and a bunch of cc debt. (no med debt though, at least not yet!)

  4. #4
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    Default Re: How are Luxury Items Treated in Bankruptcy

    A bankruptcy trustee is not going to look at your credit card statements and doesn’t care about your purchases.

    The credit card company may claim actual fraud under Section 523(a) of the Bankruptcy Code, but there is no presumption of nondischargeability under Section 523(a)(2)(C) for the charges you described.

  5. #5
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    Default Re: How are Luxury Items Treated in Bankruptcy

    What does that have to do with exemptions?

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