Before filing bankruptcy, many debtors work hard to pay every bill they possibly can even if they are sending less than what is required. But there are certain bills that debtors should stop paying immediately when they know they are going to file bankruptcy.
Bills You Should Stop Paying Before You File Bankruptcy
Let's take a look at a few:
Credit Card Bills
If you know you're going to file bankruptcy, you should stop paying your credit cards immediately. No, we are not trying to "stiff" the credit card companies out of their money. We are trying to protect the debtor from wasting their assets on something that is going to be discharged anyway and we are also protecting the debtor from being accused of showing preference to one creditor over another.
One of the things that some debtors do is maintain payments on one credit card while allowing other debts to go into default because they want to keep that credit card after bankruptcy. But the reality is once the debtor files bankruptcy, they can kiss their credit card account goodbye. The credit card company will close out the account and mark it as discharged in bankruptcy.
House or Car Bills
If you know you're going to file bankruptcy and that you're not going to keep your house or car, stop paying on them. Once again, it makes no sense to waste your cash on making payments on something you don't plan to use after bankruptcy anyway. Many debtors feel guilty about discontinuing payments even if they are going to file bankruptcy; but there is nothing immoral or unethical about discontinuing payments.
Remember, this is debt forgiveness; it is okay to walk away. The mortgage company and finance company will write off their debts. So everyone gets a fresh start in the end.
If you're filing for bankruptcy, you may want to stop paying your utility bills ONLY
if they are already delinquent. And in that case you may only want to pay for your current usage if you're at risk of a disconnection. Once you file bankruptcy, your gas, electric and water company will not be able to disconnect your service for nonpayment of bills prior to your bankruptcy. However, if you file bankruptcy and fail to pay your utility bill for usage after you file bankruptcy, you can lose services.
Utilities such as cable television and internet service are not governed by these rules. After filing bankruptcy on your cable television or internet service bills, it is possible that those services may be cut off for nonpayment. In that case you may just search for another service provider.
Have Any Questions About Your Bills and Bankruptcy?
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