Be Careful Where You Bank

There are undoubtedly countless things going through an individual’s head as they go through the bankruptcy process, such as:

• How did this happen?
• How can I get through this the easiest?
• How can I make sure things are different afterwards?

One thing that a lot of people do not think about, however, is where they bank. Consider the following, however: You currently owe a large sum of money to the bank where your checking account currently is. What’s to stop the bank from cleaning out your checking account to pay off your debt balance?

While there are some rules which prevent this from happening, there are also a lot of technicalities that banks can use to siphon your money without obtaining your approval first. It’s well known that banks will seize property from delinquent account holders, and this can include your checking account.

Bankruptcies can be very complicated and time consuming, and it may be overwhelming having everything placed in front of you at once, but this is a tip that must be remembered: As soon as you make the decision to file for bankruptcy, you need to set up a new account with a bank you have never dealt with before.

While some people will view this as being dishonest, like you are hiding assets from the banks, the truth is that everyone has necessary expenses, such as food and water, electricity, gasoline, etc. Allowing your checking account to be cleaned out by the bank can turn a bad financial situation into a catastrophic one.