If I Am Filing Bankruptcy, When Do I Stop Paying Creditors?

You decided you will file bankruptcy, for sure, so when do you stop paying those pesky creditors?

Hey, I am a lawyer, so the answer is: it depends.

If you are keeping your house, keep paying the mortgage or mortgages.

If you are keeping your vehicle, and are current, keep making the lease payments or payments to purchase the vehicle.

Although depends on the chapter you will be filing.

In the Detroit bankruptcy court, if you are behind on a mortgage or other secured creditor payment like a car, you must make that payment through the Chapter 13 trustee as part of your plan.

So, maybe yes, maybe no, you need to consult with your attorney on the best use of your funds before you file.

Water bills, gas, electric, cable, internet, things that you will keep using, and are current on, you keep paying.

If you have overdue bills for these services, those have to be listed as debts on your bankruptcy schedules.

The utilities know what to do; they get hundreds or thousands of bankruptcy notices every month.

You will get a new bill from the bankruptcy filing date forward, for what you use after the bankruptcy case is filed.

Gas and electric are also governed by state regulatory agencies which restrict what they can do.

Cable and internet, not so much.

You should check on alternatives, see if you can get a better deal somewhere else.

If you are filing bankruptcy, you need to cut corners and save money.

How about credit cards?

Unless it is like American Express used to be, you pay it off every month like the electric bill,

Stop!