Should I Change Banks Before Filing For Bankruptcy in New York?

Should I Change Banks Before Filing For Bankruptcy in New York?

There are many good reasons for changing banks prior to bankruptcy, so when we initially meet with a client this is often one of the first things we will advise them to do.  Changing banks is usually smart, but don’t confuse this with taking money out of your accounts in an effort to keep the money out of your bankruptcy by hiding the cash from the court.  Hiding assets is illegal and could get you into a lot of trouble.  It’s the job of your bankruptcy attorney to help you protect your assets through the legal means provided under the bankruptcy code.  These consumer protections in New York are very powerful and can adequately protect your assets in most all cases.  In other words hiding cash or trying to put it into someone else’s account is never worth risking the outcome of your bankruptcy when there are so many strong legal ways to get you the debt relief you need.

We will advise our clients to change banks if they owe the banks any money, and also have a savings account with them.  If you owe your bank on a mortgage for example, the bank will take the money owed to them for your mortgage from your other accounts.  If you do not switch to another bank you may lose control over your funds.

It is also usually a good idea to change banks if you are facing a wage garnishment.  Once a creditor has a judgment against you, they will come after the last known bank account for you.  Changing bank accounts can prevent this from happening and will buy you some time before your bankruptcy is finalized. Your bankruptcy discharge will completely eliminate your debt to this creditor and therefore of course stop any future wage garnishments as well.

Your attorney will help you tidy up all of your bank accounts prior to filing depending on your bankruptcy needs and particular financial situation.   If you are completely overwhelmed by toxic debt and bad loan payments the most important thing to do first is arrange an appointment with a qualified law firm specializing in debt relief and consumer bankruptcy.   If you live in New York and need to find affordable bankruptcy help please give the Law Offices of William Waldner a call at 212-244-2882 to arrange a free bankruptcy consultation.  We are a personalized boutique firm with a 99% Chapter 7 discharge record as of 8/31/16.

This article is intended for educational purposes only.  By reading this article no attorney-client relationship has been created.