Are bank accts protected from same bank credit card collection when I file?

[NewPage]

We removed my name from my husband's B of A business (sole proprietor) checking account in April, as well as from the household account. I have a separate checking account at a different bank (established well over a year ago, probably about 18 months ago actually).

The reason we removed my name from the B of A accounts is because I have a credit card with them, which obviously will be going into the BK. We were concerned that when I quit paying the B of A card, they would go after any funds in the accounts. I am still current on that card and I guess plan to be until I file.

My questions:

1) Can B of A take funds from the accounts after I file?
2) Can they take funds from the accounts before I file if I quit paying the minimum?
3) Can they take funds even if my name is no longer on the accounts?

Thanks

[ccsjoe]

1. No, that would be a collection action and once you file that money belongs to the bk estate.
2. Yes, cross collateralization, aka right of setoff.
3. Not sure, depends on your banking agreement, but I doubt they would be able to.

[pikaroth]

As ccsjoe said, the answer to #2 is yes. This was an issue for me due to having a checking account with Chase and also two credit cards with them. Just today I finally opened up a new checking account with a much smaller bank (BB&T, to be honest, I could not care less what bank, I just needed one where I had no CC and was close by, which this was), everything went fine, and now I have just two items "pending" with my Chase account, and when those are done, I'll be completely closing that account. I stopped paying on the cards a few weeks back, and they have yet to 'dip' into my checking account, but I was advised by people here that, yes, they could do that (though that does not mean they will), and then my attorney said the same thing and advised me to get an account with a bank that I have no CC with, and, again, just did that today.

[keptdigging]

I don't know what they can do or what they will do but I do know this: If the money is in a different bank you don't have to even ask the question. I just wouldn't have any more there if at all possible (I realize with a business this can be more complicated.)

It was actually a lot of work for me to find a bank I didn't owe money too.... but I eventually found one around the corner who are ridiculously friendly (Comerica.)

Remember it is not exactly unheard of for banks to accidentally (or "accidentally" if you're less trusting) move money or freeze accounts when they're not supposed to. Then you have a fight and even if you win, you've had stress, and loss of access to your funds.

All this risk goes away if the money is in another place.

[NewPage]

I have been after my husband to go with a different bank or at the very least open new accounts, but he won't.

[tcreegan]

Hi NewPage,

Can we assume you are filing alone?

1) Can B of A take funds from the accounts after I file? No, but the BK trustee can. Be sure you can exempt what you have in any acct

2) Can they take funds from the accounts before I file if I quit paying the minimum? ...it would be buried in fine print somewhere and they sometimes do what they are not supposed to anyway. As others have said, move the acct, I'm like keptdigging, our new bank is ridiculously friendly

3) Can they take funds even if my name is no longer on the accounts? No

I am still current on that card and I guess plan to be until I file If you know you are filing, no point in paying on debt that is going away in the near future. As my Grandma would say, no sense throwing good money after bad.

Tom in Colo

[jcj112562]

Although I filed under Chapter 13, I had a B of A credit card which was included in the BK, as well as checking and savings with them. I still have both the checking and savings, the only thing that happened when I filed was the removal of the CC account from my online portfolio, and they did not take any money from either checking or savings. Your mileage may vary, of course.

John

[tcreegan]

That is good news about your BoA accounts jc, nice to hear something positive about a large financial company for a change....

Tom in Colo