Hello, my first post here. I decided to file

[RuthCB]

Hello everyone. Thank you so much for this forum. It has really helped.
Not only with information, but calming some of my fears.

I think I am almost more nervous making my first post here than I was when I met the lawyer last week. I have a lot of questions, but I will be brief here.

I have had an S-corp for 35 years. The past five years, it has been touch and go, but I was still making it. The last two years the bottom fell out. Foolishly I was so devoted to the business and my employees, I used my personal credit cards to prop up the business and even borrowed on my cash value life insurance to keep it going. I thought I could weather the economic storm until there was a turn-around. I plan to close the business in June.

When I close, I will have no way to pay off my debts. At age 61, other employment looks doubtful. I plan to take early Social Security in Jan. 2011.
My husband and I will file personal bankruptcy. I'll write more about the business later.

I have not missed any CC payments, loans, or taxes as of today. That all ends as of April 30. I will reaffirm my home loan and an auto loan.

I have a lot of confidence in my lawyer. I love her. She says I shouldn't have any trouble. We will have a no asset case.

Now, my first question. She says it is not necessary to open a new checking account because once we file, they can't do anything. I have my checking both personal and business, car loan, and line of credit with Bank of America.
From reading here, I am concerned they will freeze the accounts.
Opening new accounts is a real hassle on top of preparing for the BK and finishing up the business responsibilities ( my busiest time of year is May-June)

So, should I go ahead and open a new account? How about just opening a personal account?

[zpbk13]

Welcome to the forum! It took a lot of courage for me to make my first post too. I spent an entire weekend before registering just reading all the great information. I do not think I could have had such a successful chapter 7 filing without all the help I receievd from this board.

I don't know anything about business so I won't even attempt to answer your questions about that but I will say that it probably is a good idea to open another account just so you don't have the added worry of whether BOA will freeze your accounts. I am sure others will respond to your other issues. Take care!

[blockhead]

Why risk it?

While your credit is OK, open a new account at a bank where you have no debts or other entanglements. If it's a personal account you can often open one online.

[NoMoreCards]

I just wanted to welcome you to the board as well. It is scary making the first post here, I had a rough time of it as well and now I can't shut up!!

You will learn that we do not bite, and only nibble once in a while!

If I were in your shoes, I would open a new checking account at a bank that you do not have any other accounts with. I have no experience with BOA to say the will or will not freeze the accounts, but why have the additional worry?
It seriously only takes 30 minutes to open a account, then you can slowly move things as time allows.

Anyhow, I wish you the best.

[RuthCB]

Thank you for your responses. From reading here, I thought that might be the best thing to do.

I have a few other entanglements that I will ask about later.

[frogger]

Welcome RuthCB. Do open your new accounts now.

Do not start moving, shifting, or transferring assets in or out of the corporation.

[RuthCB]

Welcome RuthCB. Do open your new accounts now.

Do not start moving, shifting, or transferring assets in or out of the corporation.

Thank you for that advise. That brings me to this question.
My business owes me $20,000 in past personal loans I've made.
I haven't paid myself a salary in over a year. Could I take out some as a loan payment to myself? I'm not filing BK on the S-Corp*, just doing personal and naming creditors to protect myself. I wasn't planning on taking much, just enough to pay the lawyer. My lawyer DID say I could make it in the form of salary.
Of course this is if there is anything left after payroll taxes.

*skip this if you aren't interested in reading about the S-Corp.
My business is one where it is nothing without me there. There are no assets to speak of, just my name. Back in 1998, banks were giving out lines of credit right and left. I couldn't believe that BoA gave me a $35,000 LOC with only the assets as collateral. I said "sure" The interest rate is really low too.
I'm walking away from that obligation. I'm putting it on the personal BK to protect myself as the President ( husband is Sec). They could sue I guess, but they wouldn't get squat.