Should I Stop Paying My Bills?

I often get asked the question, “If I am filing Chapter 7 bankruptcy, should I stop paying my bills?”  The answer is Yes and No.

First the No. You must continue to pay certain bills, like your rent or mortgage, vehicle loans for any cars you intend to keep post-bankruptcy, most student loans, utilities, and other basic living expenses.  In most cases, you will indicate in your Statement of Intention that you intend to reaffirm the debt on your car, and that you intend to continue living in your home or apartment.  In addition, while you may intend to erase past utility bills from a former address, you should continue to pay the utilities for your current address.

Now the Yes. If you intend to file for Chapter 7 bankruptcy, you should stop paying most unsecured debts, including credit cards, medical bills, and personals loans.  (“Unsecured” debts are debts that aren’t tied to an asset like a home that can be foreclosed upon, or car that can be repossessed, once you stop paying.)  Since these debts will be discharged in your bankruptcy, making payments to your creditors is just sending good money after bad. Moreover, the Bankruptcy Code prohibits payments of more than $600 within three months of filing a bankruptcy, especially to family or friends. If you make a large payment within a year prior to filing of your bankruptcy, the bankruptcy trustee assigned to your case may sue the person to whom you made the payment to get back that payment for your creditors.

Of course, once you discontinue paying, your creditors will send your accounts to collection agents, who will attempt to harass you into paying. For this reason, you should file your bankruptcy as quickly as possible. Otherwise, creditors will move forward with collection efforts, including obtaining judgment, garnishing your wages, and filing liens against your real property and bank accounts.

Once you retain Lee Legal, our office will begin take your creditor calls up to two weeks before you file your Chapter 7 bankruptcy.  When your case is filed and the Automatic Stay kicks in, you will be protected from all collection efforts by operation of law.  If you are considering filing bankruptcy in Virginia or D.C., call attorney Brian Lee at (202) 448-5136 and schedule a free consultation.


  1. Tonie Gillespie says:

    How recent can purchases be on a credit card before filing?
    Im so afraid to file but I am working just to pay my bills and have not money after Im done paying all my bills. I need help, but I dont know where to start

  2. 1. Don’t purchase “luxury goods or services” within 90 days of filing bankruptcy. 2. Don’t take out cash advances within 70 days of filing bankruptcy. 3. You may use credit cards for purchases reasonably necessary for the support or maintenance.

    See this link for more info:

    Hope that helps, Tonie!

  3. Tracy Johnson says:

    I read that I can lose my car. It is paid for and worth about $7000. I need my car and am worried I won’t be able to get credit to buy another one after filing. What can I do?

  4. You should discuss this with a bankruptcy attorney. If your car is worth more than the vehicle exemption, then you may be able to pay the difference to the bankruptcy trustee and keep the car you currently have. It is certainly true that it will be more difficult to obtain vehicle financing after you file Chapter 7 (at least for a time), but it is not impossible. Based on the limited facts that you present, I would say it’s better to try to negotiate with your Chapter 7 trustee and retain the vehicle. Again, I strongly suggest discussing possible outcomes with an experienced bankruptcy lawyer in your jurisdiction.

    Good luck!

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