Credit card companies levying bank accounts?

[gunnagtthr]

Can credit card companies levy my bank account for past due amts before my bankruptcy is actually filed? A friend of mine was months behind on her pmts and went to buy something...her bank acct had been emptied.

I am assembling my btcy papers now.

[LadyInTheRed]

To levy your bank account, your creditors must first sue you and get a judgement. If you owe money to the same institution where you bank they may be able to drain your checking/savings account without getting a judgement if there is a cross collateralization provision in the account terms. This is common with credit unions.

[btbeme]

Banking where you owe money is bad juju. When you default, the bank can - and will - take your money, take pictures of themselves enjoying your money, swim around in your money like Scrooge McDuck in his money tank, and leave your account littered with zeros.

So don't bank there if you are about to stiff them with a credit card debt, a car loan, a mortgage, etc.

Otherwise, it takes a judge's signature to take your cash....although I have heard of banks that have your account info (you paid them online, etc) "mistakenly" taking a payment or three from your account when you default. Of course this is illegal (generally) but it is also a major pain in the butt to unravel. So, change accounts or do whatever you must to break that money trail.

If you switch banks, withdraw using a bank or cashier's check and make sure you open the new account with that check. Keep copies of the transactions so the Trustee can see that you are not trying to pull a fast one.

[buffetbuster]

Before we filed, I didn't pay on my credit cards for about a year. I was getting sued and had some default judgments against me, which were removed after filing BK, but it hadn't gotten to the point where they were levying my bank accounts. I did have a loan through my CU that I wasn't paying on and they froze my account because of it, meaning I couldn't get to any of my money. I had to immediately change banks and change my direct deposit to go to the new bank. Other than my account getting frozen by my CU for their loan, I didn't have any levies.