31 Jul Can I buy a car before filing for bankruptcy?

Q. I think I’m going to have to file for bankruptcy. I’m waiting because I think I want to get a new car first, or at least spend money to fix my old one, and I’m going to need to use credit cards. All my cards except for one are maxed out and I can barely make the monthly payments (I’m late on a few and one I haven’t paid in two months). But I need a car to get to work. If I use credit to fix or buy the car, will that be a problem with the bankruptcy?
— Poor

A. It makes sense that you need your car to get to work, but spending money now could lead to trouble if you file for bankruptcy.

Anything charged within 90 days of your filing is considered non-dischargeable, said Karra Kingston, a bankruptcy attorney in Union City.

“This means that you will still have to pay back your creditors even though you filed for bankruptcy,” she said.

Moreover, charging on your cards within 90 days of your bankruptcy filing gives creditors the opportunity to file an adversary proceeding against you.

“An adversary proceeding is a lawsuit within your bankruptcy case,” Kingston said. “If creditors feel you charged on your credit card knowing you were going to file bankruptcy, they can view your bankruptcy as fraud.”

She said filing a fraudulent bankruptcy can be grounds for a dismissal of your case or even a criminal offense.

She recommends you speak with a bankruptcy lawyer before using your credit cards prior to filing for bankruptcy.

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This story was originally published on July 31.

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