Can I Load Up On Debt Just Before The Bankruptcy?
Can I load up on debt just before the bankruptcy? Min Austria Assistant at Ascent Law LLC Maybe you've heard the term "bankruptcy cramdown" before. It's a phrase that means "the debt is reduced to the value of the assets." The idea is that, once the debt is calculated, your creditors get paid back and you're left with whatever else is left. It's a great way to get out of debt. The trouble is that bankruptcy requires you to submit a full list of your debts, so if you have a lot of really expensive stuff and not much cash on hand, it's going to come out looking like you don't have much in the way of assets. But there are some things that you can do to make yourself look more solvent than you really are—especially if you're trying to get rid of credit card or student loan debt. As long as you don't own anything valuable or can't prove that it has significant value (like an insurance company), it might be smart to run up a huge bill o...