Bank took $1100 out of my checking account

[jribe]

A creditor took $127 from my bank account - post judgement, of course. They went through all the legal means to get it. A week after the took it, I filed for BK. About 3 weeks after that, the creditor sent a check in my name for $127 to my lawyer.

That was a surprise.

as an example to the OP- the above quote is someone that had a judgement placed and got their money back..
What happened to you - was not a judgement/lien/garnishment.
It was a creditor taking what was owed to them - you won't get it back.
If the money gets returned- it would be split between the creditors in your bk estate. you can't exempt it and get it back.

[California]

you need to give more clarification. Was the loan through the same bank? Or was it an ACH that you asked to be stopped (to be paid to a different lender)?

If it's the later- you can file a claim with the bank (reg d i believe) and get the funds back.

If it's a loan you had with the same bank- no go. They are owed the money and since you have an account there (with auto pay i assume) they had the right to take it.

If you want to provide more info i can provide a better answer

It was Wells Fargo. I was 3 payments behind on my car loan. The loan was also through Wells Fargo (it was not a judgement levy)

[JRScott]

Oh if its Wells Fargo get all your money out of them now. They are the worst and most unfriendly to bankruptcy of any bank.

Yeah you wouldn't get the money back they basically used a clause in your loan that says they can take it from your checking/savings account you have with them. If the trustee goes after it he would distribute it to your other creditors.

Sorry this happened to you.

[music12]

i thought something that was taken from you before you file is not property of the bk estate and cannot be exempted. so i am very confused as to why bankruptsee's creditor returned money that was taken before filing bk.

[hopeforus]

Yep... You are screwed since it was Wells Fargo. There are nightmare stories about them on here. Sorry

[MSbklawyer]

You are right about it being a preference, but there is a section of the code that recognizes "setoffs" that would likely let the bank keep the money. An example of a setoff is where person A owes person B money. Person B also owes person A money. Person B, rather than paying person A, simply cancels his debt to A by canceling A's debt to him.

A bank deposit is a form of debt. The bank is in debt to you for the amount of your account balance. Simultaneously, you are in debt to the bank for what you owe them. The bank can "setoff" the debt it owes you (your account) by canceling an equal amount of debt that you owe the bank.

That gets them around the preference problem if they do it before bankruptcy.

[DSIG]

Yep we moved ours all to a locally owned bank a few months ago. Was a pain in the butt because we had just moved from USAA (where we have our mortgage and a credit card) to USbank where we had no debt. BUT... We got a letter from USBank about owing money to Elan Card which was from First Flight. I guess they were part of them now so we didn't feel safe with USBank anymore even though they said they couldn't take our money for Elan. I didn't trust it.

So we switched and I'm assuming since it's a locally owned bank that we are ok now.

just curious -- how did USAA treat the balance in your checking account? I also bank with them and am shopping around for other local banks since they also told me that they will restrict my online access

[DeadManCrawling]

I think your statement was a little wordy and just not true,

If you had money taken (before filing) as a garnishment you can exempt the money and get it back.

If you had money taken (before filing) as a levy you can exempt the money and get it back.

In both of these cases money was taken before the filing but if it is listed in Schedule B as an asset and exempted you can get it back.

This is even proven further by the fact that the creditor cannot hold assets of the estate and deprive the owner the use of them if they are exempted.

This is why when you have money taken out as a garnishment (and the money is exempted) you can call the creditor and tell them to release the money. If they do not release the money than they face a violation of the automatic stay for depriving the debtor of there property.

This would be correct IF it was in the form of a garnishment or proceeds from a judgement, and then only in certain circumstances.

Since you owed the bank on another account and they took it to pay that debt, there is virtually no chance of recovering this money for yourself. As a preferential payment, if the trustee pursues it successfully, it will be split among your creditors.

Again, sorry this happened to you and I hope it serves as a warning to others to be aware of cross-collateralization agreements and remove their funds from banks where they owe money.

[DSIG]

Can you open a new checking account the day after you file? If you do it before you file you would have to list it. And is there any problem with saying you have x amount of dollars at filing but then slowly draining that account after filing? Or do they expect to see x amount?

I'm also concerned that my bank, USAA, will retaliate. The problem is that I have my life and auto insurance policies with them and my payments for those policies are auto-payed through my checking account. I also have my son's 529 college fund there. I owe on their cc.

[debtmonster]

I have a checking account with Bank of America. We also have a credit card with Bank of America that we've been current on all this time and we have a balance of over $900 on it. We just filed bankruptcy yesterday. Is Bank of America going to dip into our checking account and take out the money once they get notice that we filed bankruptcy?

[jribe]

I have a checking account with Bank of America. We also have a credit card with Bank of America that we've been current on all this time and we have a balance of over $900 on it. We just filed bankruptcy yesterday. Is Bank of America going to dip into our checking account and take out the money once they get notice that we filed bankruptcy?

they'll only do that if you're late on payments. Honestly- since you have debt with the same bank you have accounts at; you need to get a new bank.

If you have DD- switch those immeadiatley.

I've seen people worried that the banker will think something's fishy when you come in to close your account- they won't.

They are very sales oriented and are waiting for the next checking account to walk in. Most will not spend more than 5 minutes with you to close an account; and actually at BOA- i believe they let tellers close accounts.

Bottom line: Get a new bank/cu. and don't deposit any more in to the boa account

[debtmonster]

I have direct deposit with Bank of America now.

Are they going to close my checking account? How do you get an account with a credit union? I thought you had to be a member of an organization to do this?

[DSIG]

I have direct deposit with Bank of America now.

Are they going to close my checking account? How do you get an account with a credit union? I thought you had to be a member of an organization to do this?

Try TD Bank if they have branches where you live. I have not filed for bk yet but will do so next week. About 2 weeks ago I submitted an online app to TD bank. They sent me the paperwork to complete and submit with my deposit. I wont open the account until after I file bk, though.

Another option is Chase bank and they are also all over the place. They sent me an offer of $100 cash back if I open a checking account with them. I think there are some strings attached there like you have to use your own money for the initial deposit and you also have to do dd which you probably will do anyway.

I havent decided now if I will use TD bank or Chase. Probably chase since I heard TD bank does not offer secure credit cards.

Check it out.

[debtmonster]

I think I owe Chase bank for something in my bankruptcy.

I don't want to go to a CU. None of them are close by. Bank of America's are on almost every corner down here. I am happy with BoA.

[jribe]

I have direct deposit with Bank of America now.

Are they going to close my checking account? How do you get an account with a credit union? I thought you had to be a member of an organization to do this?

if you're filing on debt with BOA - you NEED to get another bank. At least until after discharge. They won't automatically close the account; you go in and request it.

You can go to ANY bank in your area that you don't have debt with. Doesn't need to be a CU - just noticed many people here prefer them.

The problem is (and i work at a major bank) there are clauses that allow for the bank to take funds out of your accounts (any you're list on) to "offset" any debt owed to them.

That is why i am saying to change your DD- either get a check and cash it (then deposit somewhere else) or open an account an another bank and have DD sent there.

You can keep your BOA account open; just don't leave money in it. Make sure you won't get service fees though. That way once you're done with your BK you can go back to them. They can't retroactively take money after you're filed and closed.