Friday, February 19, 2010

Lawyerly Advice: Where to bank

(This is a paraphrased conversation that I had with my lawyer. It is not ME giving advice, so don't take it as such and always consult your own legal counsel.)

"Is there anything that I need to know that haven't asked, or that trips up most people?"

"Don't bank where you owe money."

"Oh. Crap."

"If you don't pay a bill the bank could, in theory, take money out of any of your other accounts. I've seen it happen where suddenly a couple couldn't pay their rent or buy groceries because the bank took all their money to balance and cover the other account."

This is a problem.

We bank at Bank of America and they are my largest creditor. I owe just over $16,000 at 15.99% in a Gold Options loan. My payment is $350 a month.

I could continue to pay it to avoid having to switch banks, but that's throwing money we need away. Eep.

Going into the account each month is my husband's disability payment (the longest and hardest to change) and his paycheck (easy to change).

Coming out of that is all of our billpay payments (not too hard to change, just have to make sure we don't miss any), our three life insurance premiums (I already have the form, just need to fax it), our health insurance (a little harder, but also just a fax), Netflix (easy), and my web hosting (connected to paypal, so I have to change that over, but not too hard).

The hard thing is going to be closing the old accounts, opening a new one, and making sure things get paid when there's money. The disability is going to be challenging if it doesn't get moved over.


I know this will be work. I know it is. But it's little things like this that are more about coordinating twenty pieces of paperwork that are going to annoy me.

I found out that it will take about a month to go over the paperwork once I turn it in. Both the lawyer and his trustee/lawyer partner meet with me, revise, meet with me, revise, etc. until it's perfect.

I have to wait until we get our tax refund to do that, because if we file prior they will seize the money, rather than being able to use it to pay the lawyer's fee.

And also before I pay so much as a retainer I have to figure out how to deal with our major issue (but that's another post).

He did say that if I was to take one thing out of the whole meeting it would be to not bank where we have debt. The second thing would be to not file for bankruptcy until we've gotten our refund in our hands.

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