Cash Advance

[Blackgoose]

I was using my overdraft on my checking account to pay my cc and other bills. So what do I do if that is considered a cash advance and I've stopped making payments on all my cards? Can I make a payment on just that or will it be considered treatment to just that lender? Min payment due would be $321.

Thanks

[Drazil65]

My husband is filing chp 7 in the next couple of weeks (our signing is on 12/2) and he also had an overdraft account he used to pay other debt. Once we met with an attorney and decided to file (or that filing was an option) we were told to stop paying all unsecured debt (including the overdraft). This happened in July and we have not paid that account during all the preparation of the last few months. The overdraft bank account became another unsecured creditor and is treated as such. Once you understand that filing is an option and meet with an attorney and everything points in that direction I think you must be careful to treat all unsecured debt the same.

Also, if this overdraft is tied to your main checking account you will need to change accounts/banks to one where you have no other debt, in your own name. If not you run the risk they will freeze the funds in that account. You should be looking into that anyway as part of the preparation leading up to the filing. Good Luck!

[lillymarlene]

Last year when I was sure that I was going to file I went out and got a new checking account for my business. I had no previous ties, loans or credit cards with this bank, where I started this new account. For my personal checking, I started using an account that I'd had for years at my "mortgage bank" since my mortgage was current.

At that time, I also had 2 checking accounts (business and personal) at a credit union that I really liked, which I had to let go. I had a line of credit or "overdraft protection" attached to the business account, which was listed in my chapter 13. Immediately after I filed, my personal account was closed, my debit cards were voided and my online access was stopped.

I agree you should probably go out immediately and start a new checking account. It's probably easier to do before you file and you will need something down the road to conveniently be able to pay certain bills.