Should I Open a New Bank Account Prior to Filing Bankruptcy?
Prior to filing bankruptcy, a common concern is whether you can keep your bank account open during the process. The answer in most cases is yes. However, if you owe your current bank money, it is generally a good idea to switch to another bank. In a bankruptcy, all creditors are required to be listed. This means if you owe your bank an overdraft charge, a credit card, line of credit, or unsecured personal loan, your bank will have to be listed as a creditor in your case. The bank will then receive notice of your filing and will likely close your bank accounts. This is why it is a good idea to be prepared and have a new bank account already set up and have your direct deposit switched to the new bank. The last thing you want, especially when you are struggling to make ends meet, is an interruption in your income. However, if your only debt you have through your bank is a mortgage or car loan, then your bank account should be just fine and will be remain open through the process.
The other concern is the timing of when to open the bank account. Generally, you can open a bank account after bankruptcy or during the process without a problem. But some banks may pull your credit report prior to opening the account and may decide to deny it if they see you filed bankruptcy. So yes, it is still possible to open a bank account after the filing, but your selection of banks may be decreased depending on which banks will run a credit check. This is why it is easier to plan and open the bank account prior to the bankruptcy filing. Many banks also will not allow you to close accounts if you owe them. That is fine because they will likely close automatically once the bankruptcy is filed or you can close them after. The main issue is getting the new account setup and opened in order to be prepared. If you have concerns about how a bankruptcy could affect your bank accounts, it is always best to discuss with an experienced bankruptcy attorney.