auto withdrawals & Wells Fargo

[frmrdwn]

Okay, so after reading this forum I realized my US bank account needs to be closed. I had automatic deposit going into it and automatic withdrawals against my 2nd mortgage coming out of it.

So, I opened an account with Wells Fargo and planned to have my automatic deposits go there for a month or so (I am only 30 days past due with creditors right now) and then switch to paper check. I really need quick access to funds this month as my work will only mail out paper checks on the exact contractual date of payment. So, instead of receiving direct deposit on the 17th or 18th of the month, it will go in the mail on the 20th. That's a longer time between pay days. But, I digress.

After reading all of the posts about Wells Fargo freezing bank accounts when people didn't even have accounts with them (credit or otherwise), I see there could be a problem. I was going to have my car/home insurance withdrawn from Wells Fargo and have my paper check go into a local bank starting in October.

Opinions, please.

1. Should I close my Wells Fargo account?

2. Should I keep my Wells Fargo account open and only deposit enough for the car/home insurance each month? Keep the local account open for salary deposits.

3. Should I just keep open my local bank account, deposit by check and have automatic withdrawals from the car/home insurance come from there?

My car/home insurance will only allow me to pay by paper check if I pay $250-300 per month and take a month off here and there. I can't budget like that.

Finally, and I know I this sounds paranoid, will creditors be more likely to locate my bank account if automatic withdrawals come out of it? How does that work anyway?! 9 months is a long time to go without paying people, but I understand it is possible to file bk before the lawsuits come into play!

Thanks!

[Pizza]

Okay, so after reading this forum I realized my US bank account needs to be closed. I had automatic deposit going into it and automatic withdrawals against my 2nd mortgage coming out of it.

So, I opened an account with Wells Fargo and planned to have my automatic deposits go there for a month or so (I am only 30 days past due with creditors right now) and then switch to paper check. I really need quick access to funds this month as my work will only mail out paper checks on the exact contractual date of payment. So, instead of receiving direct deposit on the 17th or 18th of the month, it will go in the mail on the 20th. That's a longer time between pay days. But, I digress.

After reading all of the posts about Wells Fargo freezing bank accounts when people didn't even have accounts with them (credit or otherwise), I see there could be a problem. I was going to have my car/home insurance withdrawn from Wells Fargo and have my paper check go into a local bank starting in October.

Opinions, please.

1. Should I close my Wells Fargo account?

2. Should I keep my Wells Fargo account open and only deposit enough for the car/home insurance each month? Keep the local account open for salary deposits.

3. Should I just keep open my local bank account, deposit by check and have automatic withdrawals from the car/home insurance come from there?

My car/home insurance will only allow me to pay by paper check if I pay $250-300 per month and take a month off here and there. I can't budget like that.

Finally, and I know I this sounds paranoid, will creditors be more likely to locate my bank account if automatic withdrawals come out of it? How does that work anyway?! 9 months is a long time to go without paying people, but I understand it is possible to file bk before the lawsuits come into play!

Thanks!

If you're worried about someone grabbing your money, I'd keep what's in the account in question spent down as low as you can go on necessities, cancel any direct deposits/automatic withdrawals and bank elsewhere, preferably a small bank that doesn't offer credit cards.

To answer the first question of your last paragraph, if you pay a creditor with an account, even with a personal check, they've got enough information to freeze your account. Although they are SUPPOSED to get a judgment first, I've read, especially here, about surprise withdrawals and it's tough to do anything about it. Money orders are your friend.

Finally, if you plan on filing BK in the future, keep in mind that no matter where you're banking, you will have swear under oath that you're not hiding money or any other assets from creditors, so you aren't going to be able to pull a fast one. Spend it and spend it wisely; keep your receipts on major purchases.

[frmrdwn]

That's what I am trying to plan ahead for. I want to be transparent with the trustee- I have nothing to hide. And if wages are garnished, so be it. Just don't want to wiped out after a payday and not have food or utilitiies.

[qsr]

I bank with Wells Fargo, and have a CC and Reserve Line with them. So far I have been making payments and they are making a killing on my overdrafts/etc. I'm wondering if I need to quietly switch to another bank and let this one go insolvent. I have a few auto-withdrawals for things I need from it, though.

[NewLifeAhead]

frmrdwn....I would close the Wells Fargo account BEFORE you file. I had a mortgage, credit account and checking account with them. I closed the checking before I filed. As you have read, some people's checking/saving accounts were 'frozen' even though they didn't have credit cards or mortgages with them.

A lot of us have learned to not have checking/saving accounts with banks where you have credit or secured accounts.

[momisery]

So, I have read on here that people are saving up cash for after the BK. Then I read that you have to tell the trustees what you have in cash stashed. We were hoping to save up some for a deposit, rent and moving expenses. In MO I am not sure how long we will be able to stay in our home that we are losing. We are not so high in foreclosures, the loan on our home is with BOA, but it may go faster just because our state is not as high in rates for foreclosures/bk/s. Can you save some cash to live on after it all crashes? We are working on the cash for the attorney right now, so we are certainly not loaded up with cash and all of that will be gone as soon as we file.

[Pizza]

So, I have read on here that people are saving up cash for after the BK. Then I read that you have to tell the trustees what you have in cash stashed. We were hoping to save up some for a deposit, rent and moving expenses. In MO I am not sure how long we will be able to stay in our home that we are losing. We are not so high in foreclosures, the loan on our home is with BOA, but it may go faster just because our state is not as high in rates for foreclosures/bk/s. Can you save some cash to live on after it all crashes? We are working on the cash for the attorney right now, so we are certainly not loaded up with cash and all of that will be gone as soon as we file.

"Can you save some cash to on after it all crashes"?

Hiding money and swearing under oath that you don't have any is perjury. Spending it on necessaries and retaining an attorney is legal. It's true that one COULD hide some away, but if it's not legal, would you want to chance it?

Now if you use it to get an apartment/rent house or something like that, housing is a necessary expense, so I would work that situation out before filing. You may also be able to exempt some cash by analyzing certain exemption amounts. You may not be "loaded up with cash" right but if you filed BK, then somehow magically came up with the money for a new place to live, it could definitely draw some unwanted attention.

Keep in mind that it could be months or longer before creditors take any action at all. I'm 3 months behind on 4 credit cards and still getting the 'nice letters'. Be careful, and make sure that you will be better after BK than before.

Good luck.

[momisery]

We will be better off since we don't have a dime left at this point and have a ton of bills. We will of course spend what we have on an attorney, and the cash we are saving for a place to live is a "have to have" of course. they can not expect you to move out of the home you are losing into a rental with nothing? Certainly you have to have something saved or plan on living on the sidewalk as a maytag box would be too costly? It is hard to save anything right now except for the money for the attorney. Once that is done, saving for the first, last and current rent will have to be our goal. If it takes 3 months to discharge we might have it for a cheap place.. not sure right now.

[kenshirley]

Do what you think is right.
I transferred all my retirement direct deposits to a new Wells Fargo account to get away from B of A that we owed money to.
Wells Fargo has been nothing but nice to us and we have had no problems whatsoever.
The key here is to do business with a bank that you do not owe money to.

[liz417]

I had WaMu (which is now Chase) checking and savings accts., I switched over to WF right before I filed BK because I BK'ed over $26k with Chase. I had NO PROBLEMS with WF with my BK (I have a checking, savings and a Mortgage acct with them), in fact my attorney screwed up and filed my case on a Thursday (payday) instead of what we agreed on Friday! I had over $3k in the account and WF never "froze" anything. A another poster said that WF would "freeze" if you account had more than $5k in there...I never had that problem