Can they really get into your checking account?????

[ilovemycaitybug]

I read on another forum that anyone you had auto payments set up with will be able to vaccuum any money from the account you had set up with them! Is this true??? Do I need to move our household bank account before filing? My hubby thinks this is absurd and won't do this............. but............ what if??

[krobin02]

If you have any debts with the bank at all, there is usually something, however small, in the fine print regarding this. I would open a checking account with another bank prior to filing and leave the old one open with like $5 in it if I were in this situation.

[ilovemycaitybug]

Thanks for your response! I don't have a debt with the bank, just with credit cards that draw each month automatically (which I have turned off). Does that make a difference?

[lrprn]

KRobin is right - the problem you describe is possible when you have a dischargeable debt with the same bank that has your checking or savings account and the bank has a clause in your account agreement that allows them to take money from one of your accounts in the bank to cover withdrawals or shortfalls on another (standard when you have overdraft protection). When the bank is notified you have filed, they may (not necessarily will) take money from your other accounts (checking, savings) to cover the amount you owe the bank.

I would be sure to discuss this with your lawyer - he or she may be aware of local issues related to this.

Also like KRobin, I've learned that what is right isn't always what is legal. If you really want complete protection, the only way to absolutely assure that is to open another checking account at a different bank or credit union. If you decide to do that, be sure to do it *before* you file. From others' comments here on the boards, it can be difficult to open a checking account right after filing. Good luck - keep us posted on your progress!

[ilovemycaitybug]

They can even get it if the debt isn't with the same bank??? So turning off the automatic withdrawls does nothing?

[SinkingFast]

Lrprn was talking about if you have a CC or car loan or something like that with the same bank as your Checking/Savings is set up with.

It's called Cross Collateralization. Gives your Bank the power to cover one debt, a CC or auto loan with them, from another acct like your Checking and/or Savings accts.

Creditors from outside cannot just come in and vacuum out your acct. That most likely won't happen. Unless the Creditor gets a Banking Institution Garnishment against you. Most States, you'd know if that's gonna happen. You'd have to be served first.

[fellowpoorman]

I had no problem at all openimg a new checking account after filing, this may be a myth.

[SinkingFast]

I had no problem at all openimg a new checking account after filing, this may be a myth.

The advise I read when I first joined here was to open a new bank acct the day after filing. That way, the new acct wouldn't be part of the BK estate, AND your BK wouldn't have had time to become public record/knowledge.

[lostsoul23]

Creditors get access to a trade paper that reflects anytime people open new accounts, get services turned on, off, etc. I closed out my bank account before filing, and still haven't opened one up yet because there have been a few 'stragglers' that haven't gotten word yet my BK was discharged earlier this yet.

As far as clearing out your account, a judgement is all that is needed. You would get served first *unless* it is an administrative wage garnishment, but those apply primarily to defaulted student loans. This is why I always tell anyone I call not to pay with check (been in trouble alot for saying that) to pay with money order and keep the stub as proof for payment. You pay a past due bill with a check, and I promise that creditor will keep that info on file and that goes to the attorney if your loan gets to that point.

Good luck.