CU Accts/Cross collateral

[cantbreathe]

We have our deposit accounts with a CU which we also owe for 2 autos , a personal loan and a visa. Our atty says close deposit accts and make payments on cars only. (They are all automatic withdraws and we plan to keep cars). It feels so wrong to walk in and ask them to close accts. after 20 years. Should we get cashier's checks made payable to us and then open other bank accounts elsewhere? We plan to file within a couple of weeks. We stopped automatic deposits today.

[Maine]

Should we get cashier's checks made payable to us and then open other bank accounts elsewhere?

Yes.

Also- If you are leaving the account open to deposit only the car payments that may be a bad idea too. There is a small chance they will try to take the car money and deposit it to your other loans. Close the accounts completely and pay the car payment in cash or money order when it is due.

[brokejoker]

We didn't close our accounts. Instead we took the money out (left $15) and opened accounts at another bank. We sent in a check for our car payment instead of depositing the money in the CU account so they wouldn't take it and apply it to our CCs. The CU took the $15, applied it to our late CCs, and closed all our accounts themselves once they received notification of our BK.

[cantbreathe]

We didn't really want to raise any eyebrows at the CU closing our accts. We have been current on our debts with them to date. Should we expect questions from them or the "new" bank about bk? I know that it feels like we are walking around with a big "we are in financial trouble" tattoo on our foreheads. We would like to reaffirm our vehicles with them if they will let us.

[ccsjoe]

cantbreathe....just go to a new bank, open new account, then set up automatic payments to the CU car loan accounts (at my CU all had same account # but different letter designation and you could specify "car loan 5/18/10"). You don't necessarily have to close CU accounts, I don't think you can close all while you have active loans anyway, but you can write yourself a check for the balance minus a token amount and deposit that check into you new account. Nobody at the new bank will ask you about BK. We opened last weekend at a new bank and all we were asked was why we were leaving XYZ institution, we answered because we were, wanted to give new guys a try.

Any institution will allow for a reaff rather than a repo. Do not sweat this!!! If you want to reaff, just state so on the SOI.

[Silver26]

I had a car loan a savings/checking and a credit card with my local CU. I stopped paying the Credit card and I still had a open account with like 5$ in it. My CU had a weird process where they would deposit my money into checking and then transfer it to my car loan. Long story short they took my payment and held it and acted like they were going to apply it to my credit card( since it was very late ). I got my money back because they knew they couldn't dictate where my money went. The next day I closed my accounts out and I havent had an issue since. They also never tried to cross coll on our reaffirm for our car.

[brokejoker]

We didn't really want to raise any eyebrows at the CU closing our accts. We have been current on our debts with them to date. Should we expect questions from them or the "new" bank about bk? I know that it feels like we are walking around with a big "we are in financial trouble" tattoo on our foreheads. We would like to reaffirm our vehicles with them if they will let us.

We had no problems opening an account at another bank. Plus, like I said, we didn't close our CU account, the CU did after they were notified of our BK. The new bank has not said anything or touched our accounts post-BK filing. We did reaffirm the car loan with our CU. I had the same feelings as you, but actually opening the new accounts at a different bank was as easy as falling off a log!

[geye]

Our credit union would not allow us to close our savings because we had a credit card through them, so we took all but $5 out. They had no problem with us closing the checking account.

They did ask why we were leaving, and we just said that we were changing to a bank with branches closer to DH's work.

[backtoschool]

A lot of credit unions will not allow you to send a payment for a car loan only if you are bk'ing on other accounts with them. They have a right to take the money you send and apply it to whatever they want. The best bet is to close the accounts, open an account elsewhere, and try to get your car loan moved if the CU won't reaffirm.

CU's are notorious about not reaffirming. It all depends on the CU.

Most CU's will not want the car back, so most likely you will be able to just pay the car loan, but certainly you should move your other accounts to another bank.

[cantbreathe]

Thank You to everyone! Errrrr what a mess!!! Went to the CU. Can't close because I have an outstanding debit I thought would have come out instantly that didn't and I withdrew the rest. Thinking, OK no big deal, I'll give that a few days. I went to a local bank prepared to open a new account with a cashiers check and cash and they refused me. Said it was "due to my credit score". I am signing the papers at my attys office next week and I didn't think you could have any (or very little) "cash on hand" at the time of filing. The atty didn't seem one bit concerned when we met with him about our bank balances. Mine is SS so we keep them separate. I think we are a no asset case and covered by exemptions. Any thoughts?
I'll be so glad to get this behind us! Thank You to this forum and all of it's contributors!

[ccsjoe]

Did you try a bank that offers "fresh start" accounts?

[cantbreathe]

No, I haven't. How do I find them?

[ccsjoe]

Most banks and credit unions have them. How about google fresh start checking or no-credit checking or something like that. I know BofA offers them, so does US Bank. Usually denial of checking account is not necessarily credit score related, but chex-systems related.

[cantbreathe]

Thanks ccsjoe,
I almost wish it were a ChexSystems problem! I could easily remedy that. The new account rep gave me a copy of the notice. It is not ChexSystems with the problem although there is a place on the form for them as well (box not checked). It is something reported by Equifax. (box checked). He did tell me that it was because of my credit score being too low. (barely) The actual service they used is ChexSystems and I should not and did not have anything negative with them.
I was able to open a new account (online) with another bank and so far so good. I am waiting to get the welcome new customer packet in the mail which takes several days. Then I can go to the local branch and begin a real banking relationship with them.
Although I will miss the perks of being a member of a CU , and will again when I can, I just panicked thinking, OH NO!! Now I'll be cashing my checks (for a fee) and paying bills with MO's (more fees) and using snail mail with stamps (more cost)....Errrrrr This was just another bump in the road. My credit score will come up a bit ( I've read here) after I file?

[ccsjoe]

Glad it's starting to work out.