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Filling for chapter 7 bankruptcy ( Lied about income on applications )

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agh1994

Junior Member
What is the name of your state (only U.S. law)? Texas.

I have racked up 25k in debt over the course of 5 years. I lied about income on multiple CC applications with multiple banks. My income is 33k a year and I put 60k on applications. I kept lying and lying while increasing multiple credit card limits until my total credit limit of all my CC's was around 80-90k. I was young, ignorant and greedy. I grew up with a poor family and my sibling had passed away and my mom at the age of 18. I suffer from depression and a gambling problem. I lost alot of money day-trading crypto currency, casinos, bills, etc. I didn't realize what I was doing was fraud and now I am at the point where I don't think I will be able to pay back this debt. I have made 100% on time payments with all my credit cards but it has always been the minimum payment so over time this debt has built up. I am afraid that if I have to file for bankruptcy and when I go to court, all of my lies about income will be uncovered and I will be convicted and sent to prison or fined alot of money. I already changed my income to the correct amounts with all CC banks with their online banking system. Please help me. I know what I did was wrong and I probably deserve the worst and I appreciate any and all advice. Thank you so much.
 


LdiJ

Senior Member
What is the name of your state (only U.S. law)? Texas.

I have racked up 25k in debt over the course of 5 years. I lied about income on multiple CC applications with multiple banks. My income is 33k a year and I put 60k on applications. I kept lying and lying while increasing multiple credit card limits until my total credit limit of all my CC's was around 80-90k. I was young, ignorant and greedy. I grew up with a poor family and my sibling had passed away and my mom at the age of 18. I suffer from depression and a gambling problem. I lost alot of money day-trading crypto currency, casinos, bills, etc. I didn't realize what I was doing was fraud and now I am at the point where I don't think I will be able to pay back this debt. I have made 100% on time payments with all my credit cards but it has always been the minimum payment so over time this debt has built up. I am afraid that if I have to file for bankruptcy and when I go to court, all of my lies about income will be uncovered and I will be convicted and sent to prison or fined alot of money. I already changed my income to the correct amounts with all CC banks with their online banking system. Please help me. I know what I did was wrong and I probably deserve the worst and I appreciate any and all advice. Thank you so much.
You need to cancel accounts and stop using the credit cards entirely. Yes, you lied about your income but the credit card companies also didn't have to continue to give you more credit without verifying your income. You are not going to jail over this but you may end up with a chapter 13 bankruptcy rather than a chapter 7.
 
I agree that you need to stop using credit cards. You also need to take the time to deal with your depression and any addictions you have. Your health (mental as well as physical) is your priority.

If the inaccurate information was supplied a long time ago and you have been making your payments and have not run up a bunch of credit card debt within, say, the one year prior to filing bk you should be fine. This holds for any Chapter bk you may file. In any Chapter you may face a complaint under 11 USC 523(a)(2) where the creditor seeks to have its claim held non dischargeable due to "fraud". The problem for the creditor is proving fraud. One of the elements is "detrimental reliance". It will be tough for the creditor to prove it detrimentally relied upon your application when, most of the time, it simply relies upon a credit report/score and, in your case, kept increasing the credit limit without verifying income.

Talk to several bk attnys in your area. Consultations are usually free or at a very low cost. My guess is that any attny will tell you not to lose sleep over this issue so long as you are not currently running up bunches of credit card debt.

Des.
 

justalayman

Senior Member
Btw:

There is a difference between criminally charged fraud and civil fraud. It takes a lot more evidence to prove criminal fraud. As despritfreya stated, civil fraud may not even be a concern. Criminal fraud doesn’t appear to be an issue at all given your fact set.

That means, at most, the debts wouldn’t be discharged in bankruptcy court. You won’t be going to jail for this, at least based on what you’ve posted here.
 

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