long lost savings account....

[turningcorner]

When we filed bk we had 2 loans with a bank. One was a mortgage the other for a vehicle. We were behind on both. We did not reaffirm either loan because the bank would not let us. On the day the bank found out about the filing they seized and closed our savings account. We had over 3000.00 in our savings account at that time because we were trying to catch up on payments. Instead of applying the payments to either loan the bank instead put the money in a savings account and would not allow us to get the money back. After the bk was discharged and the bank did not file any objections to the bk or take the savings we voluntarily gave back the vehicle. The vehicle was sold for less than owed but the bank never mentioned taking the savings account for the defecit amount. Our mortgage we ended up doing a quit claim deed to which the bank gave it right back to us and actually was very generous in refinancing the home. Again the savings account was never mentioned nor does it show anywhere in the new mortgage papers that the bank applied it to the mortgage. My question is where did or does the savings go???? Legally could they apply it to the balance on the loan for the vehicle...?? In short they never showed us what happened to that money. The papers we got after the vehicle was sold just stated that the sale price did not cover the loan...the savings has never been addressed. We signed our new mortgage papers yesterday and they are being recorded today. Our first payment is in March. We have learned a hard financial lesson by filing bk and coming close to losing it all. We do not want the money to spend friviously if we are entitled to it---we would rather it go towards the mortgage...however are we entitled to it and how do we get it acknowledged??? We have an attorney who handled the bk and refinancing of the home. He is hard to get a hold of and will want another retainer if we ask him to investigate....is it worth it???? Again the money as far as we know is still in savings...they never asked during bk process for it to be applied anywhere. Statements show that it was still in our account long after the bk discharge and we had to declare it as an asset on our bk. thanks for any advice. I know how lucky we were with this bank to get our mortgage taken care of and come out as good as we did. I would forget the savings but I would like to know where it went and when it was taken.

[bkfiler]

if they had a cross-collateral type loan on those two items then they can take the money.

go to the bank and ask them where that money went. it is your right to know what happened to it.

for any other readers out there, do not keep money in accounts where you hold loans for secured items, or unsecured for that matter when you go to file bk. it is your right to take out all your money and hold it in cash for protection before filing for a bk. of ocurse you must disclose it on the petition.

[turningcorner]

so am i correct in assuming???

I know cross collateral affects things that is why we could not get the money out of the bank before bk--we were behind on payments...however during the bk process they then had the right to legally obtain the money and did not do so. the bk was discharged and the money was still entact in savings after the discharge. As part of the house deal we voluntarily gave back the vehicle for sale. We owed 8000.00 it was worth 5000.00 ands they sold it for 2000.00. The new mortgage did not include any payment for vehoicle loan.So if the cross collateral theory is correct can I assume that if I elect payroll to be direct deposited at this bank so my new mortgage can be paid that the remainder will still go to the vehicle loan that was discharged in the chpt. 7??? After all if the cross collateral theory remains in effect after a discharge they rightfully could not only seize my savings they had but in effect take future deposits as well???
thank you for your answers...

When we filed bk we had 2 loans with a bank. One was a mortgage the other for a vehicle. We were behind on both. We did not reaffirm either loan because the bank would not let us. On the day the bank found out about the filing they seized and closed our savings account. We had over 3000.00 in our savings account at that time because we were trying to catch up on payments. Instead of applying the payments to either loan the bank instead put the money in a savings account and would not allow us to get the money back. After the bk was discharged and the bank did not file any objections to the bk or take the savings we voluntarily gave back the vehicle. The vehicle was sold for less than owed but the bank never mentioned taking the savings account for the defecit amount. Our mortgage we ended up doing a quit claim deed to which the bank gave it right back to us and actually was very generous in refinancing the home. Again the savings account was never mentioned nor does it show anywhere in the new mortgage papers that the bank applied it to the mortgage. My question is where did or does the savings go???? Legally could they apply it to the balance on the loan for the vehicle...?? In short they never showed us what happened to that money. The papers we got after the vehicle was sold just stated that the sale price did not cover the loan...the savings has never been addressed. We signed our new mortgage papers yesterday and they are being recorded today. Our first payment is in March. We have learned a hard financial lesson by filing bk and coming close to losing it all. We do not want the money to spend friviously if we are entitled to it---we would rather it go towards the mortgage...however are we entitled to it and how do we get it acknowledged??? We have an attorney who handled the bk and refinancing of the home. He is hard to get a hold of and will want another retainer if we ask him to investigate....is it worth it???? Again the money as far as we know is still in savings...they never asked during bk process for it to be applied anywhere. Statements show that it was still in our account long after the bk discharge and we had to declare it as an asset on our bk. thanks for any advice. I know how lucky we were with this bank to get our mortgage taken care of and come out as good as we did. I would forget the savings but I would like to know where it went and when it was taken.

[StaciMM]

During the BK, the automatic stay prevented them from trying to collect which includes the savings. If the accounts were cross collateralized, then they may be able to take the savings & apply it to the balance on the car even though the car was in BK.

Talk to someone at the bank...

I'm really not sure how it works-generally cross issues happen before filing, so I'm not sure how the BK impacts it overall.