Retirement accounts like IRAs and 401ks are also protected from bankruptcy, and they’re probably the route I’d go if I was trying to be clever.
Of course, I suspect that a clear pattern of excessive borrowing and large retirement contributions would still get some raised eyebrows from the various parties involved in a bankruptcy. The bankruptcy process is a mixture of rules and interpretation/judgment.
If I understand everything so far, it appears that my first roadblock would be in the bankruptcy court, where the judge and everyone else involved would immediately see through my plan and throw me out on my ass. To my untrained eye, it doesn’t feel like they’d be able to get me for bankruptcy fraud – I’d be open and honest with my finances, and I’d be legitimately unable to pay back my debts without selling my house. However, questionable fraud accusations aside, I’d likely get thrown out for some other reason, and my ability to successfully file for bankruptcy would depend heavily on my ability to navigate the bankruptcy court. Something my imaginary 25 year old scheming ass is very unlikely to do. I think that successfully pulling this off would be nearly impossible unless I paid good money to an outstanding bankruptcy lawyer, which would eat up all of my ill-gotten profits anyway.
So… followup question – is it fraud to borrow money with no intention of paying it back? I suspect this is where the real criminal charges would come from, but I don’t know anything about this stuff.
Dischargability is what would force you to pay it back anyway - here’s the Code section
Fraud charges can be alleged by a creditor, but are prosecuted by the Dept of Justice. They don’t always happen together.
So far as a definition outside of bankruptcy - I have no idea.