Bank Account questions

[qwertysue]

Hi!

DH and I have signed our ch13 papers, and are awaiting word on the *official* electronic filing.

DH was able to open a new bank account with a credit union today. I was turned down due to Chex (which honestly shocked me...I will be calling tomorrow to find out from the reporting bank what the issue is).

Our current bank balance is at a minimum--enough to pay an automatic bill that goes through in the next few days and about $50 additional.

Earlier this year, the bank did a Right of Offset one time. They have not done any other debits.

My questions:

When the bank (which is also a creditor for a LOC) receives notice about the filing, are there any indications what will happen to the checking account?

Will the account be frozen?

Will next week's direct deposit from work be made available to me? (I am going to go with manual checks for the time being, but this payroll period was too late to stop the direct deposit)

Will the bank allow the account to remain open and available for my use?

TIA!
Sue

[lrprn]

Welcome to BK Forum, Sue - glad you found us!

When the bank (which is also a creditor for a LOC) receives notice about the filing, are there any indications what will happen to the checking account? Will the account be frozen?

If LOC is Line of Credit and this LOC is not secured (like overdraft protection), then it's possible after you file that your bank may take the amount you owe on the unsecured LOC out of the account if the account agreement you signed has a cross-collaterization clause. If it did, then after you file, the bank can legally take money out of your checking account to pay off the unsecured LOC account without prior permission. Cross-collaterization clauses are common. However, if the LOC is secured (a second mortgage or a car loan, for example), then you should be fine.

How much will be in this account on filing day? What is the automatic withdrawal payment that is coming for?

And not to add another worry to your pile, but if the amount of money in your account on filing day exceeds the amount that can be covered with an exemption, a few trustees have been known to take the extra from your account for your creditors even if checks have already been sent out to pay a bill such as a mortgage or car payment and the creditor cashes the check . Is the amount in your account on filing day going to be under whatever you are allowed to have with your exemptions? If it is, then this won't matter.

Will next week's direct deposit from work be made available to me?

Yes, but if the account is drawn down to pay for an unsecured LOC you included to be discharged in your Ch 13, the amount you receive could be far less.

Will the bank allow the account to remain open and available for my use?

Yes, most likely. But I wouldn't recommend using it until your case is confirmed. And if the bank takes money from your account for the LOC, then I would leave $5 in it and figure out a way to use your husband's account until you sort out your CHEX issue or find a bank that doesn't use CHEX - they do exist - http://www.chexvictims.com/. Click Agree - it's free - this site just requires that you register as a member.

Call your lawyer today and see what he/she thinks about this situation. Since they know all the details of your case and we don't, they are the most reliable source to sort out what may happen when you file.

[qwertysue]

Welcome to BK Forum, Sue - glad you found us!

Thanks!

How much will be in this account on filing day? What is the automatic withdrawal payment that is coming for?

There was $94.99 in the account on filing day (last week). The $50 automatic withdrawl was for insurance. I checked the account online and it went through yesterday. :::insert sigh of relief::::

Is the amount in your account on filing day going to be under whatever you are allowed to have with your exemptions? If it is, then this won't matter.

Way under the exemption ;)

Yes, most likely. But I wouldn't recommend using it until your case is confirmed. And if the bank takes money from your account for the LOC, then I would leave $5 in it and figure out a way to use your husband's account until you sort out your CHEX issue or find a bank that doesn't use CHEX - they do exist - http://www.chexvictims.com/. Click Agree - it's free - this site just requires that you register as a member.

That is a great link...thanks for passing it along.

For now, it's a timing issue--DH has changed to a manual check for this pay period and will deposit his into the CU account, which will have a 7 day hold as a new account. Fortunately, we have enough cash on hand to deposit to cover any bills that will pop up within those 7 days.

I was able to get a manual check, thanks to a superhero boss, and I will be cashing that at the bank on which it is drawn (Ironically the bank that reported me to Chex).

We have our 341 date, and I'm trying to send good energy out to the universe that our plan is accepted as is, or with a little modification.

Is there a way to check out the track record of our Trustee and what he generally approves?

Thanks again,
sue

[lrprn]

Is there a way to check out the track record of our Trustee and what he generally approves?

There is, but it's going to cost you some money. Go to the PACER sticky here - http://bkforum.com/showthread.php?t=1011 - and then sign up for an account. (PACER = Public Access to Court Electronic Records)

Here are all the answers to any question possible to ask about PACER - the PACER FAQs at http://pacer.psc.uscourts.gov/faq.html

Once your account access is granted, you can look up cases in your local bk court by your trustee's name. *HOWEVER* you are going to be charged $0.08/page and a single bk case can have many pages. Suggest you limit the first search to just your trustee's cases for only the last few weeks just in case. It isn't unusual to end up with a $50 bill for this kind of search if your trustee is a busy one, so if money is an issue for you right now, proceed with a lot of caution.

Hope this helps!