What Happens to My Checking Account In Bankruptcy?
By Bankruptcy Attorney on Apr 30, 2007 in Colorado, General Bankruptcy Information, Protecting Assets In Bankruptcy
If you owe your bank money they may close your checking and savings accounts after the filing of the bankruptcy.
The bank may not take any money from your accounts after you have filed to off-set their debts. However, sometimes they do and then it takes a while to get the money back.
Some banks will freeze the money in a bank account after you file bankruptcy, if you owe the bank on a credit card or other loan.
Often it is advised that Clients open and begin using another bank account at a small local institution prior to filing bankruptcy. They should not incur any debt with this institution prior to filing their bankruptcy.
This new checking account should keep money from being taken mistakenly to off-set debts or frozen accounts.
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