Bad credit = no debit card?

[SJM]

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[AngelinaCatHub]

Yes I've heard of that happening. However........what are you doing with 10k in a bank? If you have not filed yet, put it into exempt stuff, like food, blankets etc. or you may get that taken as assets. Perhaps others can chime in and varify this. 'Hub

[JRScott]

If your filing as Hub says the 10k cash is a bigger problem.

But yes you can be denied a debit card for bad credit as most debit cards today are VISA/MC. I'm wondering if I'll get mine renewed in december.

[Cali]

Unless you are in an area where you can exempt that 10k, I would advise you to put it in something so it doesn't get taken away from you.

And yes I've heard of banks doing that.

[Flamingo]

The lower your credit score, the more risk you pose to the bank. Banks do everything in today's economy to protect themselves. Were you provided paperwork from the bank when you opened your account? View the papers your signed or any information given to you and you will probably find information related to your checking account and your credit. Many people cannot even open accounts with bad credit or BK on their records. Your promise of never ever bouncing checks doesn't mean a thing to the bank; credit scores do. To the bank, the lowering credit score puts them at a higher risk of losing money with you as a customer. You are just encountering some of the things that occur when ones credit starts to decline, the bills are late, etc. It will get worse.

Other posters are correct as to the money although you will use it quickly since your husband is out of work. Are you behind intentially on the mortgage? With $10,000, you can make up those two late payments quickly in order to avoid losing your house. You do not state your intentions.

[SJM]

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[Cali]

So that means 20k exempt, what happens to the rest?

Hi,

The amount we have is over $10K. I said it's over $10K. It's actually $42K that we got from selling a small lot we owned and also selling a hot tub we had purchased for the home we walked away from.

We were not intentionally behind as we couldn't make two of the payments, but now can make them, but keep in mind our payments are $4,200 a month and without my husband working we will not be able to make payments very long and also have money to pay for living expenses. It'd be ridiculous to use $10,000 of that to get caught up and then have to pay another $4,200 next month to again keep our mortgage current, but behind before the end of summer.

We live in Washington and from what I've read, we each have $10K in exempt money, right? We plan to use the money and pay an entire year's worth of rent (we pay $1,500 per month) and that will keep us secure in the townhome we're living and "use up" some of the money.

Any thoughts on this?

Thanks.

[Help!]

Hi,

The amount we have is over $10K. I said it's over $10K. It's actually $42K that we got from selling a small lot we owned and also selling a hot tub we had purchased for the home we walked away from.

We were not intentionally behind as we couldn't make two of the payments, but now can make them, but keep in mind our payments are $4,200 a month and without my husband working we will not be able to make payments very long and also have money to pay for living expenses. It'd be ridiculous to use $10,000 of that to get caught up and then have to pay another $4,200 next month to again keep our mortgage current, but behind before the end of summer.

We live in Washington and from what I've read, we each have $10K in exempt money, right? We plan to use the money and pay an entire year's worth of rent (we pay $1,500 per month) and that will keep us secure in the townhome we're living and "use up" some of the money.

Any thoughts on this?

Thanks.

How long ago did you sell the lot? We were asked at our 341 if we sold or transferred any assets in the past two years. If you are an above-median 7 filer, the proceeds from the sale of the lot can also be counted against you as income. If you haven't already found a good lawyer to advise you about the sale of the lot, I would do that now to make sure you don't do anything that complicates your filing.

[Minnymouth]

SJM,
I understand you have sold some property with proceeds of $42,000 left over, out of that $42000 you are going to pay your rent for 1 year in advance. Is this correct?????

If so, it isn't going to happen that way........ Some of your money will be exempt and you will be able to keep it... The rest will go towards your debts.

ANYTHING you pay to rent ($4200) or pay in advance to a creditor (rent of for a year) will be seized by the trustee and distributed among your other creditors.

If the sale of the property was recently, that won't fly with the Trustee either.

You need to have a consultatin with a good attorney who can answer a lot of the questions you have since you have sold property recently. Don't be surprised if he tells you to hang on for a year or so before filing......

I know this doesn't sound good right now but an attorney may be able to clear a lot of things up for you...... especially since you have so much cash involved to get rid of....

[SJM]

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[diviaruba]

Hi,

The amount we have is over $10K. I said it's over $10K. It's actually $42K that we got from selling a small lot we owned and also selling a hot tub we had purchased for the home we walked away from.

We were not intentionally behind as we couldn't make two of the payments, but now can make them, but keep in mind our payments are $4,200 a month and without my husband working we will not be able to make payments very long and also have money to pay for living expenses. It'd be ridiculous to use $10,000 of that to get caught up and then have to pay another $4,200 next month to again keep our mortgage current, but behind before the end of summer.

We live in Washington and from what I've read, we each have $10K in exempt money, right? We plan to use the money and pay an entire year's worth of rent (we pay $1,500 per month) and that will keep us secure in the townhome we're living and "use up" some of the money.

Any thoughts on this?

Thanks.

My thoughts... this is an abuse of the bankruptcy system. You are using Chapter 7 as a financial planning tool. You should count your blessings that the lot sold, providing you with liquidity to pay your rent and other bills. It seems you've been on a spending bender, and have decided that paying off your debt is just too hard. Before anyone slams me on this, here is a prior post from our OP:

"We have about the same amount of debt. Probably about $65K between my DH and I AND our credit is great (over 700). The deal is we're never going to be able to pay it all off, so for us, filing bankruptcy and starting over makes better sense and USING the money we would have spent paying the never-ending CC bills each month, to begin a fresh life learning how to budget with actual dollar bills rather than shiny plastic cards.

We've done tons of charging and balance transfering over the last few months are defaulting on all our cards in July and then just sitting for 6-9 months with our phones turned off! lol"

Now I understand your DH has lost his job, but you've decided that your 12 month plan is to live off of this windfall, not pay anyone back, walk away from your home and then stick it to your creditors, after dodging their entreaties for 6 to 9 months. While I applaud planning for a bankruptcy, I am disturbed by those that plan to go bankrupt.

[keepmine]

But, the OP does say they've walked away from a mortgage so, the deficency balance on that added to the cc debt makes the total much higher.

Personally, I've no problem with using bk as a financial planning tool. Large companies do the same thing-using bk to break collective bargaining agreements,etc. It's just a tough cold cruel world out here and if you don't put your best interest first you're going to get eaten alive when it comes to debt and collection issues. That $42k windfall gives them a lot of options many don't have. Don't blame them a bit for trying to hold on to it.
The only issue I'd have is they seem determined to spend it. I'd try and save as much as I could in the form of IRA's, annuity products, education funds for children,etc. Things that are exempt assets in bk.

[SJM]

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[diviaruba]

Well, I wish you luck, then. You're going to need it.

[pa308]

Back to the original question, has anyone experienced having their debit card cancelled dut to filing bk??