Posted on: 25th Feb, 2010 09:54 am
(1)Has anyone ever heard of this happening:
If you bank or have investments at an institution to which you owe money, on a loan or a credit card, that institution probably has the right under state law to take your money on deposit and apply it to your debt to them.
Thus, if you file bankruptcy owing a bundle on your Big Bank credit card, Big Bank can take the contents of your checking account at Big Bank on the day you file to pay the credit card bill.
So, good planning says "don't have your assets in institutions to which you owe money. "
(2) I live in Southern California and would like to know If I file Chapter 13 am I allowed to put money away for retirement. My employer mathches the 1st 5% that I contribute.
(3) If I include a rental home in my Chapter 13, and I surrender the home, Does the Bank still send me a 1099C for next year taxes. The home is only worth around $120,000 and We owe around $190,000?
Thanks in advance for your advice
If you bank or have investments at an institution to which you owe money, on a loan or a credit card, that institution probably has the right under state law to take your money on deposit and apply it to your debt to them.
Thus, if you file bankruptcy owing a bundle on your Big Bank credit card, Big Bank can take the contents of your checking account at Big Bank on the day you file to pay the credit card bill.
So, good planning says "don't have your assets in institutions to which you owe money. "
(2) I live in Southern California and would like to know If I file Chapter 13 am I allowed to put money away for retirement. My employer mathches the 1st 5% that I contribute.
(3) If I include a rental home in my Chapter 13, and I surrender the home, Does the Bank still send me a 1099C for next year taxes. The home is only worth around $120,000 and We owe around $190,000?
Thanks in advance for your advice
Hi rcatc,
A bank cannot garnish your wages unless it has got a judgment against you from the court. So, I don't think your bank will be able to deduct money from your account just because you owe them.
As far as I know, retirement accounts cannot be garnished or taken into consideration when you file bankruptcy. Thus, you would be able to save money in your retirement account. In Chapter 13, you would get a repayment plan to pay off your dues. Thus, if you pay off the dues, you won't receive the 1099c.
Thanks
A bank cannot garnish your wages unless it has got a judgment against you from the court. So, I don't think your bank will be able to deduct money from your account just because you owe them.
As far as I know, retirement accounts cannot be garnished or taken into consideration when you file bankruptcy. Thus, you would be able to save money in your retirement account. In Chapter 13, you would get a repayment plan to pay off your dues. Thus, if you pay off the dues, you won't receive the 1099c.
Thanks