If I obtained some payday loans to pay for my bankruptcy, would I be able to discharge them or is that considered fraud?

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If I obtained some payday loans to pay for my bankruptcy, would I be able to discharge them or is that considered fraud?

Asked on June 2, 2011 under Bankruptcy Law, Alabama

Answers:

M.D., Member, California and New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

Any time money is borrowed with the intent of not paying it back, a fraud is committed. So taking out a loan with the knowledge that a bankruptcy will be filed is illegal.  Further, a debt may be non-dischargeable in bankruptcy if it was incurred without an intent to repay.

Note:  Generally, the longer the length of time between any particular use and the bankruptcy filing, the less likely the usage will trigger a challenge to dischargeability.


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