What becomes of your bank account during bankruptcy?

[lotsahats]

Just one question: An account cannot be seized or levied without a judgement, right? I don't owe money where I bank, and I'm hoping to be able to file C7 before any legal action is so much as threatened. I've considered taking my name off the account to protect it (as it is jointly owned, by both me and my husband, who won't be filing with me), but I don't want to do anything that would look suspicious in the eyes of the trustee. I'm just concerned about it being seized.

[Guest123]

We closed our accounts and opened a new one that had no ties to any of our debts.
We had a credit union that financed a car and a couple of line of credits, a few of our debtors had our bank account information as we paid them either online or had auto withdrawl.

[iswmle]

We closed our accounts and opened a new one that had no ties to any of our debts.

Exactly what I did. Didn't have a problem with opening up an account with another bank and I moved everything as soon as the decision to file was made.

[lillymarlene]

We closed our accounts and opened a new one that had no ties to any of our debts.

Ditto. Best and safest thing to do. My credit union, where I had a small revolving line, cancelled my debit card and closed my checking account when they were notified of my BK. Then also, it's probably good to be very cautious to who you allow to get any information about the new account. A few years ago, I made a small payment over the phone to one of my business vendors with a credit card. Then he helped himself, without my permission, taking money each month out of that card until the bill was finally paid. I probably could have fought him over it, but at the time I felt it wasn't really worth pursuing.

Since then, and also of course because of my BK, I've become super cautious. I will never have a bank account (well a significant one anyway) where I have a loan. Then, with certain people, I will go out of my way to pay by money order, I feel the less information I'm handing them the better.

[LadyInTheRed]

Just one question: An account cannot be seized or levied without a judgement, right? I don't owe money where I bank, and I'm hoping to be able to file C7 before any legal action is so much as threatened. I've considered taking my name off the account to protect it (as it is jointly owned, by both me and my husband, who won't be filing with me), but I don't want to do anything that would look suspicious in the eyes of the trustee. I'm just concerned about it being seized.

Right, a creditor needs to get a judgment before it can levy your account.

Taking your name off the account could be considered a transfer to your husband. Better for him to open a new account in his name only and spend the money in the joint account to pay your living expense until it is empty. Be sure to close it once it is empty so account fees don't cause an overdraft.

[lotsahats]

Right, a creditor needs to get a judgment before it can levy your account.

Taking your name off the account could be considered a transfer to your husband. Better for him to open a new account in his name only and spend the money in the joint account to pay your living expense until it is empty. Be sure to close it once it is empty so account fees don't cause an overdraft.

Thank you, Lady.

So, if we take the steps you suggest, do you think the trustee would understand why we did it? Because I was looking over the Statement of Affairs paperwork, and one of the questions specifically asks about accounts that have been closed. You don't think that would appear suspicious?

[Freddy03]

Thank you, Lady.

So, if we take the steps you suggest, do you think the trustee would understand why we did it? Because I was looking over the Statement of Affairs paperwork, and one of the questions specifically asks about accounts that have been closed. You don't think that would appear suspicious?

I was facing possible bank levies and already had a garnishment I opened a few new checking accounts so I didn't have all my money at one location. The trustee never questioned it. And if it was questioned you have a valid reason.

[LadyInTheRed]

The reason that question is on the statement of financial affairs is to make sure you aren't hiding any assets. If you close an account with a significant balance, the trustee will want to know what you did with the money to make sure you didn't hide it under the mattress without reporting it as an asset.

I closed a checking account a month before filing for reasons that had nothing to do with creditors or my BK. The trustee never asked about it.

[lotsahats]

The reason that question is on the statement of financial affairs is to make sure you aren't hiding any assets. If you close an account with a significant balance, the trustee will want to know what you did with the money to make sure you didn't hide it under the mattress without reporting it as an asset.

I closed a checking account a month before filing for reasons that had nothing to do with creditors or my BK. The trustee never asked about it.

MY account? A significant balance? HA!

I understand now, though. Thanks for your input (and you, also, Freddy).

[LadyInTheRed]

MY account? A significant balance? HA!

You are not the drone they're looking for.

[discouraged]

I had 3 accounts when I filed, 1) because the credit union wouldn't close it because I owed them money, 2) Just for internet payments for the computer, 3) the one I opened when I moved all my money from the credit union prior to filing the bk. The trustee didn't even blink.

I believe they realize people will protect the little bit they have when they fnally are forced to file bk.

[obwnlink]

What will become of my checking account? Will I still be able to use it for regular, necessary transactions, like buying groceries, or paying rent? Or will it be (for lack of a better word) seized?

I had a checking, savings, two credit cards, and a HELOC with B of A. I also have a checking account with Wells Fargo (it was my play money fund). B of A closed all my accounts after I filed for bankruptcy. Wells Fargo did nothing. I'm using my Wells Fargo account as my primary account these days...........

[lotsahats]

Taking your name off the account could be considered a transfer to your husband. Better for him to open a new account in his name only and spend the money in the joint account to pay your living expense until it is empty. Be sure to close it once it is empty so account fees don't cause an overdraft.

Okay, one more question about that...

When the time comes for me to file, will his new account be considered one of my assets? I know it would be protected from being levied in a judgement, but I wouldn't think that not having my name on an account that I am living off of would stop the trustee from wanting to know about it. They will, after all, need to know about my husband's income. How does that work?

[PANSYFACE]

I have a credit card, LOC,mortgage, checking and savings with Bank of America. When the s**t hit the fan - they froze my line of credit even though I was paying ontime and through a debit. the credit card was chrged off and sold. Then the last judgement holder
took money out of savings (big 1.94 that they got) and caused my checking to be an overdraft. If I didn't cover it it waould have cost me $70 in service fees. This is why I went on a search for bank that my husband could open an account at - no go.
The only place it seems that doesn't pull credit report is a CU 4 miles away - looked at the online app and there is a box for chex systems but nothing else.I have two business accounts not associated with any credit etc but I am out of business -would keeping them be considered fraud?

I never had anything that I didn't cover but the LOC will be included in bankruptcy. Would that be reported to chex systems?

I need an account for auto debits for husband's business. I can't close BOA because of the LOC - the creditor can go in as much as they want until it is closed. Obviously - I must file asap - lawyer is fully retained. It will be a LOOONNNGGG weekend of work but I have to do it.

[IamOld]

Pansy I'd open the account then before ANY possibility of any chex reporting...as long as you disclose/list it isn't an issue.