Your bank account is your lifeblood. Without it, you can’t pay your bills, withdraw cash, or do most of the things you need to do for yourself and your family. So, how can you protect your money in the bank?
It is important that you plan in advance before filing a bankruptcy case. You can protect a certain amount of money in your bank account in a bankruptcy case. That amount varies depending on which state you live in. For example, in Illinois, you have a “wildcard” exemption which allows you to protect $4,000.00 per person worth of household goods and other personal belongings. This includes money in the bank. So, you need to plan accordingly. If you file bankruptcy with too much money in the bank, the bankruptcy trustee could use the money from your bank account to pay your creditors back.
The other thing to remember is to act quickly to protect your bank account. State Law allows you to protect it. But, a creditor could act first, and freeze all of your bank accounts. Seizing bank accounts is possible in Illinois after a creditor gets a judgment against you. When your bank account is frozen, you would really have a hard time living. Filing a bankruptcy will allow you to stop that creditor. Then, you can go to the bankruptcy court to try to release that money. This is usually easier than trying to defend the lawsuit in state court, however, you have a limited time to try to get the money back.
It is extremely important to avoid getting to the point where the creditor can seize your bank account. That means you should pay attention to any collection notices, attorney letters or lawsuit papers you may get. If you ignore them, they can get the judgment and freeze the account.
When you meet with your attorney, you need to provide copies of recent bank statements, and let him or her know all of the bank accounts you have. Then, the attorney can give you the best advice about how to best protect your most important lifeblood, your bank account.
Daniel J. Winter
LAW OFFICES OF DANIEL J. WINTER
53 W. Jackson Boulevard, Suite 725
Chicago,IL60604
312-427-1613
BankruptcyLawChicago.com
