Bank Accts/CC with same bank?

[Anonymous]

So my husband and I both have our primary checking accounts with a local credit union as well as one auto loan and our mortgage that we’re current with and plan to keep. Additionally we have a credit card with them $500 limit and about $450 balance. First, do most people experience problems with their accounts being frozen when they file. Second, if we’re able to pay off before we file so that it doesn’t discharge, would that likely make a difference? IF we’re able to keep this low limit low interest card after filing it would be an extra bonus but I’m mostly concerned about maintaining our banking relationship and ability to pay bills there. My attorney(not officially retained yet so I hate to bug TOO much) emailed back that I should check with the bank first to see if they’ll close the account regardless when we file because many do. Again, this isn’t my biggest concern but I guess brings up the last part of my question, do you think calling my bank to ask what their procedure for handling accounts through a bankruptcy is a good idea? I don’t feel like I’d want to do that but...hate to open bank accounts elsewhere unnecessarily just to be sure we can get paychecks and pay bills 🤷🏻‍♀️

[sarux3]

I dunno, that sounds like a risky gamble to me.  I'd much rather have the peace of mind that comes with knowing my checking/savings were safe and sound with a bank not associated with an impending bankruptcy, versus hanging onto the accounts for the sake of convenience but always being worried that the accounts could be closed or even frozen with funds seized.  When I first spoke with my attorney, he advised me right away to find another bank for my checking/savings needs.

I think it's safe to assume that they will close your CC if your auto and mortgage are IIB, even if you intend to keep them and stay current on payments.  But it's just a $500 CL card, and you'll likely have little trouble opening one of those within a year of your discharge.

[FireMedic1]

Advise on here has always been go open accounts with other institutions so there's no chance it may happen. All CC's will be closed with a BK. So the card with the bank will be gone anyways. Move on to greener pastures beforee filing for safety sake. Good Luck!

[Lurker22]

most credit unions have cross collateralization meaning if they take a loss (even in bankruptcy) they have the right to offset from other accounts - most have this right and most do this; additionally most credit unions have a rule that to be a member you can not have "cost the credit union a loss" - meaning they'll terminate your membership due to a bankruptcy

I had 2 credits unions to both of these to me.....though most banks DON'T do this some do, as noted by others - always safer to setup a new account even if just for a short while (FYI - Chase & BOA didn't bother my deposit accounts even though I included credit products in a 13)

[Guyatthebeach]

When I was filing for bankruptcy, my lawyer advised me to close all my accounts where I had credit cards and loans that were going to be include in my bankruptcy the day before he keyed in the paperwork. I didn't have an issue at all. 

I do recommend that you do switch to a new financial institution, so you don't risk the chance of having your assets frozen to pay off your debt.

That's just my persona opinion.

Guyatthebeach