Negative Balance Checking Account before BK

[bkbkbk]

I have a bank checking account that had a balance of $0.00. The account was not closed. One of my creditors just did an electronic transfer out of it, so now that checking account has a negative balance. I have a loan with the creditor that I have not made payments on for several months, and the creditor stopped doing monthly electronic debits a few months ago.

I am thinking of disputing this debit with the bank I have the checking account with, but am wondering if it's worth the trouble. I've already done something similar recently, and it worked out for me.

So my question is: how bad is it to just leave a checking account alone with a negative balance before going into bankruptcy? I plan on filing ch 7 within 2-3 months.

[epiphany]

I have the same situation and my lawyer told me to include the negative checking account balance in the bk.

I also have two loans with this bank that I have not been paying so before the *s* hit the fan, I went to another bank who I had no affiliations with, opened a new checking account and redirected my direct deposits.

Good luck to you,
ep

[AngelinaCat]

We also had a negative balance at our CU when we filed. We were told to have drawn down as close to 'zero' as possible. We succeeded.

Good luck to you.

[magyar123]

What I don't understand is how your bank even processed that transaction with you having a $0.00 balance - no money in there?

[Cali]

I was wondering the same thing.

What I don't understand is how your bank even processed that transaction with you having a $0.00 balance - no money in there?

[Pizza]

Lesson to learn maybe?

If broke, close the account and deal in cash 'til the dust settles?

[sahaley]

I included my negative balance in my bk - also included the line of credit owed (@$500) as well as a -$9 savings.... Then went down the street and opened a new account, transferred my payroll direct deposit and direct debit accts to the new one right before we officially filed.

Some banks just take up to a certain amount before they will return a payment - I think mine was up to $500.

Good luck to you. My husband and I just filed ch 13 and are waiting for it to be confirmed. Its been a huge relief and I can finally sleep at night. Just found this site this week - wish I had seen it 4 months ago.... its nice to know you aren't alone.

[KKAB]

My bank will always cover a check if I have a negative balance. When I filed BK and was closing my account I had $7 in there and they still took out a $666 payment even though I hadn't used that account in over a month-- I guess they figure the overdraft charge makes it financially worthwhile!

[AngelinaCatHub]

I have to disagree with some and agree with others: I certainly would dispute the automatic draw. Most banks I know will hold until a balance comes in. Now you have an overdraft charge as well. I would dispute this and have it pulled back right away. It may not work but it won’t hurt and it will look like you are fiscally responsible to your Trustee in that you are watching all things and are taking this seriously. ‘Hub (OMG just found out wife posted and I disagreed. Oh no, headache for a month)

[epiphany]

What I don't understand is how your bank even processed that transaction with you having a $0.00 balance - no money in there?

I was assuming that the OP meant that the account was in the negative due to a bounce fee? That was what happened in my situation. It is unclear to me whether the OP's bank actually paid the creditor that submitted the transaction.

But, like others have stated, my credit union would cover anything up to 300.00 (when I was in good standing that is) and charge me 20.00 a pop. So there are institutions that will cover negative transactions to a point.

ep

[dragonnfly]

I switched banks also even though I like my old one better, I filed on my overdraft account so I just assumed they would close it. They didn't. Instead the just converted it over to a free checking account. Whatever. I still like the old bank better so I figured I would leave it open and when the dust settled I would switch back. I left $2.44 is there. Anyways same thing my car insurance didn't switch banks soon enough and I was -202.56. I had already paid the insuance online so I had no money, but I was good on car insuance for 2 months. They leave it that way for a few days and then start charging me $7. a day for the negative balance. I called and got $84. of the charges reversed but it was a pain. I would have been better off to close it, even though Im scared they wont let me open another.

[epiphany]

I would have been better off to close it, even though Im scared they wont let me open another.

Well, there are some side effects to this whole BK thing that you just gotta suck up. You can bet your bottom dollar that if you filed on the overdraft on that account, they will eventually close it, very surprising that they haven't done so yet.

I would be amazed if they EVER let you open another account and if I am wrong, I am sure that everyone here would like the name of your bank please.

Although maybe not. I have NEVER heard of a bank that charges 7 dollars a DAY for a negative fee. Sounds shady to me.

ep

[dragonnfly]

They outright told me they wont close it. After I got all my direct
deposits switched over to the other bank I called and asked them if it was
going to be closed and they were very nice about it. At the time the
balance was -7.56 because a $10 monthly fee had come out of the account.
They switched it over to the free account (that does not have overdraft) and credited the $10 fee. Huntington is the bank and they are the only bank
with in 15 miles of my house. The one I moved to is 15 miles away there is
one on my way to work but even for it I have to go out of the way 2 or 3
miles. Like I said once the dust settles I would go back to huntington in a
heart beat. I have always know about the $7. negative fee I was just never
negative long enough to incur it. One thing that saved me with them is if
you deposit checks before 4 pm they count on the same days business. I
saved a lot of fees over that one. Dragonnfly

[epiphany]

Great. I sincerely hope that works out well for you.

ep