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As savings dry up many begin to rely upon credit cards Atlanta, GA

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As savings dry up, many begin to rely upon credit cards

Given the harsh economic reality facing people today, it is easy for almost anyone to fall upon hard financial times. Indeed, for the countless individuals living paycheck to paycheck in Georgia, even a single unforeseen circumstance – such as a medical emergency of the loss of a job – can lead to dire financial straits.

Regrettably, many people turn to credit cards when they find themselves, at no fault of their own, struggling with unexpected debt. And, while many of these individuals feel they have no choice but to use credit cards to make ends meet, the practice nevertheless creates additional burdens as it often contributes to their mounting debt.

If fact, a recent survey conducted by Bankrate.com demonstrates how dependent Americans have become on credit cards, particularly when they do not have significant savings. According to the survey, only 51 percent of individuals have sufficient funds available in emergency accounts to cover their credit card debt should they elect to pay it off. Sadly, this particular finding is less surprising when you consider that the savings rate in the U.S. dropped to just 4.2 percent last November, according to the U.S. Department of Commerce – making it one of the lowest rates since 2007.

Unfortunately, the lack of saving – or, for many, the lack of the ability to save due to uncontrollable economic pressures – illustrates just how quickly a person can succumb to credit card reliance as a result of financial troubles.

Bankruptcy and its ability to help with credit card debt

Luckily, those buried under significant credit card debt in Georgia may be able to discharge, and thus eliminate, unsecured credit card debt through a Chapter 7 bankruptcy. However, while a bankruptcy typically can wipe out considerable credit card debt, individuals should be aware of certain limitations, especially when they incur credit card charges in the months leading up to the bankruptcy filing.

For instance, it is commonly advisable not to use credit cards for several months before filing bankruptcy as a credit card company can attempt to stop the discharge of this debt by alleging the person made the charges fraudulently and never intended to pay. Although, in Georgia, a credit card company alleging fraud must first prove that the person used his or her card without the actual and subjective intent to pay, which can be a high burden to meet.

However, a credit card company can also object to a discharge by claiming the debt was incurred under false pretenses or representations. Interestingly, though, bankruptcy courts in Georgia typically follow the “assumption of risk” approach with claims such as these. Essentially, this means that a credit card company assumes the risk of non-payment unless it clearly and unequivocally revokes the person’s right to use the card. The failure to make such a revocation will likely result in the discharge of the debt through bankruptcy.

It is also important to note that the bankruptcy code does outline certain circumstances in which credit card debt will be presumed to be nondischargeable, regardless of whether the card owner intends to pay. This includes situations in which the person accrues more than $650 in credit card debt on “luxury goods or services” within 90 days of filing bankruptcy or when the individual obtains cash advances of more than $925 within 70 days of filing bankruptcy.

Ultimately, given the complexity of Georgia law surrounding the dischargeability of credit card debt, it is often best to seek the counsel of an experienced attorney if considering bankruptcy as a way to get out from under a mountain of bills.

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Our Client Reviews

Gingold & Gingold LLC
5.0 / 5.0

Based on 28 reviews

Jack L.

They did an excellent job with my case. Jamie took the time to really listen and understand things. She delved into the details and was extremely knowledgeable and non judgmental. Very professional and they know what they are doing. Would definitely recommend!

All C.

Mr. Gingold was recommended by an attorney I had worked with previously. I met with Ira Gingold to discuss credit issues. He went over each specific issue thoroughly. He advised me of the potential outcomes. He did all this in one meeting for a very reasonable price. When we finished I was confident in moving forward with a resolution. He definitely wants to help people take the appropriate course of action for their circumstance.

Karen B.

Dear Mr Gingold, There are so many reasons to be thankful for all you have done and will do. Anyone who has ever had unfavorable experiences with an attorney or the legal system will feel the trepidation that I experienced once I realized that my situation seemed hopeless. It was by chance and happily good luck that I decided to put my future and sanity into your hands. I was mortified at having to deal with my debts by claiming bankruptcy. I remember in our first meeting how you assured me that I was not alone and should not feel ashamed. And, anyone in this position obviously does not have money to spare and you were clear about all the costs and allowing me to pay according to my own ability to do so. You advised me in all aspects of the law, but also, you were at each meeting incredibly supportive and complementary of my personal and professional plans. Anyone else in this situation should feel blessed to have access to your expertise and support.

Lyla B.

I thought the process of filing bankruptcy was going to be a difficult one. However, Gingold & Gingold treated me with respect and dignity from the moment I walked through their door. I had the pleasure of working with Jamie. She is very responsive, professional, and knowledgeable. She took the time and listened to my every concern and handled each and every one of them to my satisfaction. My experience with filing bankruptcy under Gingold & Gingold's representation exceeded my expectations in a major way. They gave me such a peace of mind. I am very pleased with my decision of going with Gingold & Gingold to represent me when I filed Chapter 13 bankruptcy.

Julie T.

Wow! I am finally out of debt and can say that I am debt free after completing my chapter 7 bankruptcy case with Gingold and Gingold. Mr dangled was very knowledgeable and direct with regard to my debt situation. there were no surprises and the case went as I was advised. The staff was also very helpful whenever I had a question. I will definitely recommend them in the future to my friends.

Sherard W.

I cannot say enough about this law firm. From the initial consultation to our discharge, the entire office kept me updated with every step of the entire process. I came to the Gingold after a bad experience with another law firm. Ira and Jamie immediately began treating me like family through this experience. In the end, they assisted with eliminating many debts including my 2nd mortgage. I cannot say enough about the experience and knowledge that Ira brought to the table from the office visits to the court time. Thank you very much for helping me through this tough time. Thank you.

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