Question about money orders to pay bills

[Overmihead]

This might be a silly question, but can any bill be paid for with a money order? I mean, if it's a place you usually mail a check to, do they automatically also accept money orders? Or is that something you would have to verify ahead of time with each place? (example: verizon, a doctor bill, electric bill...)

[WhatMoney]

Sure, a money order is just like a check, with a prepaid amount entered. You fill in the payee. Any payee should accept a money order for a bill. You keep the copy in case of loss or theft, where a stop payment can be placed.

Only problem is the postal service and most banks limit a money order to $1000. Higher than that you could use a bank cashier's check.

[frogger]

You keep the copy in case of loss or theft, where a stop payment can be placed.

You always want to keep a copy of it, not just your receipt. Keep a copy that has the names filled out, not just a blank money order with a dollar amount.

The down side to money orders is if they get lost/stolen, it can take several months to get them replaced.

[momisery]

I paid our insurance with a money order and it did turn into a mess. It did not effect the BK, but I wrote the wrong company name on it, as we have two insurance carriers. I ended up having to send a monthly payment in to keep the policy going. But, my bank was very pleased to stop pay and issue two new ones for me since I kept the copies. I was so angry at my self for this mistake at the time. But now I have to laugh at how rattled I was over the BK and the dumb things I believed and worried about.

[HHM]

Why go to the hassle?

[Overmihead]

Thanks everyone :-)

Not sure if we will go this route or not (cashing check & getting money orders). I'm just a little nervous...it is new territory, not paying CCs...we have only had one consult so far, and that attorney told us we shouldn't have anything to worry about depositing our paycheck as usual...since we don't owe anything/have any loans with our C.U. We will double check that in future consultations. Just wanted to be sure, if we needed to, that it was simple enough to use money orders. And, we do have a few hundred cash on hand, from a combination of Christmas money & "date night" money given to us on our anniversary by our families that I need to use for bills. But I don't want to deposit it and have someone question down the line where did that money come from, and then wonder if there is more. Does that make sense?

[mtbc]

For bills over $1,000 I just used multiple ones. The main reason was that I wasn't sure our bank account funds wouldn't be frozen, so, for things I knew I wanted to pay after filing, I took out USPS money orders in advance. Had to go there anyway to get the court filing fee in acceptable form! I did declare them as assets and exempted them, though, you are meant to list the cash you have when you file, though I suspect not many people especially bother.

[secondtimer]

I always thought bank accounts were off limits until a judgement was won in court. Although if you default on a card or note issued by an institution where you actually have a checking or savings account then they're allowed access to your account without having to go to court.
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I have to confess I maintain a minimal balance in my ck acct. Deposit funds and then pay bills the same day just in case. It seems like the banks are doing whatever they want these days.

[helpmeout]

Why go to the hassle?

Could be timing. I know that my next car payment and childcare payment is going to be paid via money order. Both places have a tendency to hold on to the check for a couple of weeks before cashing and I am filing next week. As you know, the Trustee doesn't care about outstanding checks on the day of filing.

[mtbc]

I always thought bank accounts were off limits until a judgement was won in court

At least with chapter 7 (I'd guess 13 too), when you file, typically the money you have becomes part of the bankruptcy estate; you can generally spend exempted funds on necessities without anybody complaining, but my impression is that technically it's not really "yours" again until after the 341 and it's abandoned it back to you. Some banks, a bit over-eagerly perhaps, have been known to sometimes freeze filers' funds when they learn of the filing -- presumably until they're sure the trustee or court are agreeing that you can keep them. I wasn't worried about losing the funds altogether, I was worried about that temporary freeze -- unlikely in my case, but certainly a bit of a short-term pain if I'm one of the unlucky ones. For, for me, it's not about collection, it's about the money technically being the bankruptcy estate's for a while until the 341 process and suchlike allows some official acceptance of the exemptions I claimed.

(As a side note, I'd not be at all surprised if some banks had agreement terms whereby they could snatch your bank account money for overdue credit cards you have through them, without judicial approval, unless it's flat out illegal for them to have such terms.)