bank account and bankruptcy

March 6th, 2013 by Questions

If i file for bankruptcy,can i keep my bank account.I have cheques going through the account evry month for schools and other payments.Will I be able to deposit my paycheque.My account is overdrawn , but i always deposit a paycheque every week.Need help

Posted from: Quebec


One Response to “bank account and bankruptcy”

, Barton Goth - Goth & Company Inc. -Trustee in Bankruptcy said:

Technically you can keep your account. But I would strongly recommend that you do not. If you try to keep your account you are very likely to run into problems with the bank attempting to seize funds in your account immediately after you file for bankruptcy. They technically can’t seize those funds, but because the banks are very slow to update bankruptcy information internally the insolvency department doesn’t get the information to the collection department quick enough and the funds are often seized. Now your trustee can get those funds returned, the problem is that it likely will have to be done through court and it may take 2 or 3 months to get that money back.

In addition, your bank will have to include the overdraft in the bankruptcy, and this will show on their internal records. As a result you will likely have a much more difficult time trying to do anything with the bank. So in my opinion it is always best to open a new account with an institution you owe money to.

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