The Dangers of Banking with a Creditor Bank During a Bankruptcy Proceeding

If you are in debt and thinking of filing or have filed for bankruptcy protection, you need to stop and think about whether you owe a bank any money as a creditor. If the answer is yes, then you MUST ask yourself a second question.

Do you hold any types of accounts at that bank? If the answer to that question is “yes,” you probably want to consider changing banks. If you do not change banks, the bank CAN and likely WILL take possession of your accounts to satisfy their debts.

This means the bank will seize your checking account balance, savings account balance, CD balances, or any other liquid assets in their possession. Moreover, such action by the bank is not improper. When you opened these accounts or took out a loan, part of your agreement with the bank (those long wordy papers that nobody reads but just signs) was that the bank could do this to satisfy a debt.

If you are filing or will file bankruptcy, then you will absolutely need to open an account at a non creditor bank (a bank to whom you do not owe any money) to help protect what little assets you have from being seized by the bank.

This can be confusing and the best way to proceed can be difficult. That is why The Lancaster Law Firm is here to help. Our team is ready to go to work to help you through the bankruptcy process as painlessly and as quickly as possible.

Contact us today to schedule a consultation concerning your bankruptcy.

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