Most people have their bank accounts set up with direct deposits, automatic payments, transfers and the like. Therefore, it usually is a big concern of what will happen with your bank account after a bankruptcy case is filed.
For starters, if you owe no debt to the bank, you likely can continue banking there with no issues. The reason is, there would be no loss to the bank after your bankruptcy is filed.
If you do owe debt to the bank, your account may close. A majority of banks do not close your account if you owe credit cards or personal loans. If it is a negative balance or an overdrawn account, the account will likely close though. A majority of credit unions will close your account if there is any debt owed to the credit union, whether this is loans, credit cards or overdrawn funds. This is because the bankruptcy would create a loss to the credit union.
Other things you should keep in mind regarding your bank accounts:
Up to the point your case is filed, you likely should consider having a low balance in your accounts. This is because when you owe money to your bank, the bank can technically go into your account to pay down what you owe. This is up until your case is filed. For credit unions, they can do this through the day your case is filed.
Some banks will freeze your account after a bankruptcy is filed. This is most commonly done by Wells Fargo and typically only if there are significant (usually more than $5,000) in all accounts associated with your name at the time of filing.
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No matter where you are in Minnesota, if you have any questions about bankruptcy, visit www.lifebacklaw.com to speak with an attorney. You will be glad you did!
