Bankruptcy Law Questions? Ask a Bankruptcy Lawyer Now.
The actual answer to your question, as asked, is "Yes - your friend can file a Bankruptcy if he maxes out his credit cards to hire a lawyer".
Did you actually want to know something else, such as can those credit card bills be discharged if he files a Bankruptcy?
The basic rule is debt that was incurred with no intention of paying it back is not dischargeable in a Bankruptcy.
If your nephew uses his credit card(s) to pay a defense attorney, and he is planning on paying the credit card - however how long it takes, and even if he ultimately cannot pay - that debt can be discharged. However, if he knew at the time he used the credit card that he was not going to pay, then that debt would be non-dischargeable.
As there is no way for a court to know what is in someone's head when they use a credit card - there is no way for a court to know whether someone intended to pay back the debt when they used the card - the Bankruptcy court presumes that charging more than $870 to one credit card within the 90 days immediately prior to filing a Bankruptcy means the debtor had no intention of paying it back.
Whether he wins or loses the criminal case has no bearing in this. If he loses, and is incarcerated, he can file a Bankruptcy when he is released. (He can also file while incarcerated, but this is not practical.)
I think this is what you wanted to know. If not, please let me know.Thank you!
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