Checking Account Balance

[mwesthoven]

Currently, we have $1000 in our bank account. We both get paid today and that will be about 8 or 900 more to put in it. I haven't filed my chapter 7 yet i will have the money by next week hopefully. anyhow, how much is to much in my account. Should i just cash the checks and hold onto the money or deposit it. We live in ohio and i am filing ch 7 soon i hope.

[JRScott]

Have you paid the lawyer yet?

I would cash the checks then go get money orders (Wal Mart are cheap money orders). Keep receipts but make them out for bills that come due like rent, utilities etc.

You want your checking account to have the least amount possible, under a hundred probably.

[mwesthoven]

ok... i am filing by myself. i am engaged and he is not filing nor is any of the debt in his name. i had it all when we met so it is just in my name. so i am filing alone. what do you think about him opening an account in just his name and us using that and slowly use up the money in our other account until it is low and then file? i haven't paid the lawyer yet i will probably next week or soon after that. soon though, bill collectors are starting to bug me at work. i am almost afraid to answer my office phone anymore.

[JRScott]

Hmm joint checking account and your not married. Filing Pro Se and only one of you filing.

I think you should ask about the checking account in your free consultations. Make sure that his portion is safe before he deposits anymore of his checks in it.

[mwesthoven]

i did mention that in one of my consultations and he just recently got laid off, which we knew was coming, and she said we don't have to worry about his income then since he wasn't working. it is only temporary but yes, right now, we have a joint account. does that matter? you know better than i..

[JRScott]

Actually I'm single and don't have joint accounts with anyone. That's why I said you should ask in a free consult about it. Maybe someone else with a similar situation will post here. Sorry just not something I've experienced.

[mwesthoven]

oh gotcha! hmmm... i am just worried about having to much money in there. so the day i file they look at my account and then what? will they go back and look at what i have spent and ask why i spent this much here or there?

[BurgerKingVII]

You want your checking account to have the least amount possible, under a hundred probably.

This is something that varies from state to state and depends upon what exemptions are available to you. For example, in my state, you can choose between state and federal exemptions. Under the state exemptions here, you're limited to a few hundred for cash on hand and bank deposits. OTOH, my attorney says that if you choose the federal exemptions (which is our plan), you can use the full amount of your wild card exemption for money. One could potentially exempt over $10,000 in cash/deposits under the federal exemptions.

[Spartan]

The above post is important. I have come across numerous suggestions implying that money in the checking account is automatically a goner. Not true. The federal wild card exemption and unused homestead exemption may be available to the filer, depending on the state he/she files under.

[Bandit]

I have two questions about this. I don't fully understand the reason for getting cashiers checks if you can still use your checking account to send out the bills or some of the bills. ?

I must be missing something which leads to my second question.
If you do BK, do banks sometimes, also close your checking account?..and this is the reason for getting cashiers checks?

Thank You in advance, much appreciated.

[lrprn]

I have two questions about this. I don't fully understand the reason for getting cashiers checks if you can still use your checking account to send out the bills or some of the bills. ?

If you have a little more cash in your accounts than you can protect with exemptions on the day you file, the safest way to reduce the amount is to take out the extra and convert it to cashiers checks and money orders to pay legitimate bills.

If you do BK, do banks sometimes, also close your checking account?..and this is the reason for getting cashiers checks?

Banks cannot close your account just because you file bankruptcy. You can take this worry off your list

What can happen is that if you have a credit card or an overdraft protection agreement at the same bank as your checking account when you file, if there is a cross-collaterization clause in the agreement, the bank can take money from your checking account to pay for the credit card balance or what may be owed in the overdraft protection. You can get the money they take back, but it takes time and usually a lawyer to make that happen.

[Bandit]

You can take this worry off your list

Thanks for explaining, lrprn and for answering my questions. As always, you do explain very well & I appreciate it.

[SinkingFast]

I have two questions about this. I don't fully understand the reason for getting cashiers checks if you can still use your checking account to send out the bills or some of the bills. ?

Money Orders and Cashier's Checks are much more important the closer you are to filing day.

If you write a check, it may take days, even weeks to clear. Meanwhile, that money sitting in your acct to back that check is fair game for the BK Trustee, unless you cover it with an Exemption.

If you use Money Orders and Cashier's Checks, the minute you buy them, the money is gone from your acct. No waiting for the checks to clear your acct.

It's a cash flow management tool to better control your bank acct balances on filing day.

[Bandit]

It's a cash flow management tool to better control your bank acct balances on filing day.

I understand now. We would basicly just need to use money orders through that period, like maybe once or twice to make sure the cash is clearing right away so that it does not appear that there is more than what there really is.

It is good advice...I think I got it now.
Thank You, SinkingFast.

[NotFun]

Money Orders and Cashier's Checks are much more important the closer you are to filing day.

If you write a check, it may take days, even weeks to clear. Meanwhile, that money sitting in your acct to back that check is fair game for the BK Trustee, unless you cover it with an Exemption.

If you use Money Orders and Cashier's Checks, the minute you buy them, the money is gone from your acct. No waiting for the checks to clear your acct.

It's a cash flow management tool to better control your bank acct balances on filing day.

WoW, I had no idea about this. So a trustee can actually request money that's in your account? I mean how do they expect you to buy food, gas, etc...