Cross-Collateralization - Bank of America

[diggy]

hi there

I have a checking account with BofA and also a personal loan with them. I filed Chpt 7 the other day. My personal loan with them is current in terms of payments... can they still freeze my accounts or take money from it? Or do they only freeze and take monies to pay past due amounts? I read the loan agreement and couldn't find any fine print anywhere re: cross-collateralization. I also pay the loan directly from my checking account but not via automatic deduction... more like auto0-pay where I go in online and pay it when I see fit. I assume it doesn't matter though.

I have a direct deposit coming through from my employer today (Saturday) and am afraid that by Monday my accounts will be frozen with no access to it. I was however, able to withdrawal $500 today from the atm with no problems to pay for groceries etc...

Should I go ahead and open a new acct come Monday with a new bank and re-direct my employer to send the direct deposits to the new account? Will a new bank even touch me?Obviously I am not trying to hide money and will disclose this but I certainly need money to live on.

Please advise.

[Ann]

diggy, I did the EXACT same thing just this past week. I have yet to file but I too have a BOA credit card, personal loan and an overdraft protection plan with them along with a checking, savings account. I opened a new account last week. Had my husband redirect where his direct deposit will go and I called BOA this past week and had them send me paper statements to make my overdraft protection through the mail instead of just taking it out of my account. Yesterday my husbands money was direct deposited into that account (because it would take a week to get redirected to my new bank) before he even got to work he withdrew 500 in the morning and the rest in 2 other increments through out the day. This is just the way we have to be if we are going to protect our money. I may be dead wrong here but I'm thinking you may have wanted to do this before you filed. Just my opinion and take it for what is worth because I am brand new here but when thing I have learned here from others is that you have to methodically plan your moves and still be within the legal means to do so.

[kenshirley]

I too was with B of A and had an RV loan with them.
Our attorney told us unless we were absolutely certain that we had not signed any kind of cross collateralization paperwork to get out of the bank.
He said we may have even agreed to it when we got the RV loan of when we opened our basic account.
As we did not know, we took his advice and changed banks to one we did not owe any monies too.
And he said he advises this with any bank you owe money to in any way, not just B of A.

[justbroke]

Move your accounts before filing! I had a line of credit with another big bank, and the day after I filed, they used their "right of offset" to pay off my line of credit!!!

Justbroke says: When in doubt, move your money.

[debtmonster]

We have a credit card with BoA. My attorney said one you file, they are not allowed to touch your checking account. It's 1 month into our BK from the date of file and so far no money has ever been taken out of our checking or savings accounts.

[backtoschool]

Credit Unions are the fasted movers of taking money out of accounts once bankruptcy is filed (if you have a credit card or loan with them), but just to be sure, I would definitely open an account somewhere where you don't have a credit card.

[kenshirley]

We have a credit card with BoA. My attorney said one you file, they are not allowed to touch your checking account. It's 1 month into our BK from the date of file and so far no money has ever been taken out of our checking or savings accounts.

But do you know for a fact that you never ever signed a cross collateralization agreement?
If you don't, get out.
Believe me, many have been through this already and we don't want to have to say "I told you so" later.

[debtmonster]

But do you know for a fact that you never ever signed a cross collateralization agreement?
If you don't, get out.
Believe me, many have been through this already and we don't want to have to say "I told you so" later.

Well, then if that's the case, they will end up taking the $40 dollars in my bank account right now.

[DeadManCrawling]

They can actually take much, much more than what is in the account. They can overdraw the account, add fees, use up any overdraft protections as well, add fees for that, and so on.

Then demand payment.

Nice business. When the revolution comes bankers will be first against the wall.

[fooked]

as soon as my tax refund hits the account Sept 15th, I'm closing it that morning... I have less than $1.00 in there now.. If I close it now it delays the refund 10 weeks... so I've got to keep it open.

[kenshirley]

You do what you wish. You came here asking for advice and those of use that have been through this have told you our advice.
Remember this my friend. Attorneys only practice law. Finding one that is any good at it is another thing.
Many here have received bad advice from attorneys.
Again, do what you wish. Things do change when they get that filed notice and they will take whatever avenues they can to protect themselves. But a fool and his money can be seperated quickly.
I am through here.

[lifelesson]

Our atty advised us to not bank where you owe money. EVER even when not in BK. We moved my Dh's direct deposit but left mine to the Credit union. We have 2 car loans adn a cc with them filed BK on 7/17/2009 and they have not taken anything from our account.
They were the only ones to come to the 341 hearing too. Funny part is my DH called the CU and told them we had to file and that we planned to continue our car payments. Buy the time the case settles the one car will almost be paid off. With both cars we owe less then 6,500.

We thought we were in the 60 club but are now hoping we are in the 60 day club. The US Trustee is asking questions on our C7. I'm just praying 'cause we have a so called over monthly of about 700. But I work PRN and my hours are going to drop a whole lot during this next quarter. Plaus mu DH had vacation time he had to cash into pay the atty fee. So really we aren't over by 700 we're under by at least that.

[justbroke]

FYI, for lifelesson, being over the median has absolutely nothing to do with receiving a Chapter 7 discharge. It's your income less expenses, known as your disposable income, that determines your eligibility. So, I don't know what you mean by "so called over monthly".

[lifelesson]

JB-
when atty ran our number there was an error on one line they put our yearly expense not monhly. the yearly pulled us to within $400 of our monhtly income (that extra after you pay your bills thing. Sorry new to the lingo and don't know what word to be using). When they redid us it put us at $700 above our spending (J schedule ??)

[justbroke]

JB-
when atty ran our number there was an error on one line they put our yearly expense not monhly. the yearly pulled us to within $400 of our monhtly income (that extra after you pay your bills thing. Sorry new to the lingo and don't know what word to be using). When they redid us it put us at $700 above our spending (J schedule ??)

I hpe it's that your expenses are $700 over your income. Otherwise, you wouldn't qualify for a Chapter 7. Please feel free to start a new thread if you have a specific question.