Bankruptcy and credit unions

Aug 2013
1
0
Fairhope, AL
#1
Credit unions are a lot like banks on the surface, but there are some important distinctions. While they typically offer a much more personal banking experience and more benefits than they typical bank, they are also afforded some special treatment when it comes to bankruptcy cases. If you are considering bankruptcy but have a checking account, credit card, mortgage, or loan through a credit union, there are some special considerations that you’ll have to make.

The problem with credit unions

Credit unions are great to work with so long as things are going okay financially. But when bankruptcy is looming, things can get ugly. That is the negative side effect of having such a personal relationship with a banking institution. If you discharge your debts to a bank through bankruptcy, you can still continue to work with that institution after bankruptcy. But when you discharge debts owed to a credit union, any current or future relationships with that credit union are ended. It’s important for people with ties to a credit union to keep that in mind when considering bankruptcy.

Three options

There are three options available to people who will file for bankruptcy in regards to their credit union. The first is to keep the mortgage and credit card by continuing to pay them off after bankruptcy. Credit unions have an exemption in the bankruptcy code that allow you to discharge other debts but continue to pay debts to the credit union.

A second option is to keep your mortgage but lose your credit card. Because you will discharge credit card debt owed to the credit union you will know longer be able to bank with them. They cannot however foreclose on your home so long as you continue to pay your mortgage after bankruptcy.

A third option is to walk away from your mortgage and credit card. Those debts will be discharged and your relationship with that credit union will be ended. With the second and third options it’s important to stop putting money into any accounts you have with the credit union as they will have the right to seize your funds in the event of a bankruptcy.

In considering which option to take, think about how important the relationship with the credit union is to you. Depending on how much is owed and what benefits the credit union offers, it may be worth it to maintain the relationship. In most cases however, it makes more sense to discharge the debt and walk away. A bankruptcy attorney can assess your situation and make the appropriate recommendations.

Business, real estate, and bankruptcy law and litigation news brought to you by Home | Murphy, Bantz, & Bury, P.L.L.C. - Spokane Business Corporation Real Estate Bankruptcy Landlord Attorney

Source: Will Credit Union Still Want you Post-Bankruptcy? | Fox Business
 
Nov 2012
39,563
11,526
Lebanon, TN
#2
Credit unions are a lot like banks on the surface, but there are some important distinctions. While they typically offer a much more personal banking experience and more benefits than they typical bank, they are also afforded some special treatment when it comes to bankruptcy cases. If you are considering bankruptcy but have a checking account, credit card, mortgage, or loan through a credit union, there are some special considerations that you’ll have to make.

The problem with credit unions

Credit unions are great to work with so long as things are going okay financially. But when bankruptcy is looming, things can get ugly. That is the negative side effect of having such a personal relationship with a banking institution. If you discharge your debts to a bank through bankruptcy, you can still continue to work with that institution after bankruptcy. But when you discharge debts owed to a credit union, any current or future relationships with that credit union are ended. It’s important for people with ties to a credit union to keep that in mind when considering bankruptcy.

Three options

There are three options available to people who will file for bankruptcy in regards to their credit union. The first is to keep the mortgage and credit card by continuing to pay them off after bankruptcy. Credit unions have an exemption in the bankruptcy code that allow you to discharge other debts but continue to pay debts to the credit union.

A second option is to keep your mortgage but lose your credit card. Because you will discharge credit card debt owed to the credit union you will know longer be able to bank with them. They cannot however foreclose on your home so long as you continue to pay your mortgage after bankruptcy.

A third option is to walk away from your mortgage and credit card. Those debts will be discharged and your relationship with that credit union will be ended. With the second and third options it’s important to stop putting money into any accounts you have with the credit union as they will have the right to seize your funds in the event of a bankruptcy.

In considering which option to take, think about how important the relationship with the credit union is to you. Depending on how much is owed and what benefits the credit union offers, it may be worth it to maintain the relationship. In most cases however, it makes more sense to discharge the debt and walk away. A bankruptcy attorney can assess your situation and make the appropriate recommendations.

Business, real estate, and bankruptcy law and litigation news brought to you by Home | Murphy, Bantz, & Bury, P.L.L.C. - Spokane Business Corporation Real Estate Bankruptcy Landlord Attorney

Source: Will Credit Union Still Want you Post-Bankruptcy? | Fox Business
copy this plan for no longer that 2 years and you don't have to worry about bankruptsy again.




 
Oct 2015
1
0
usa
#3
When considering yourself in problem like bankruptcy, take in mind those points said earlier, you must first consult it with your bankruptcy lawyer. Then whatever the lawyer advises you , do that thing in that way so that you will not go through any kind of mess related to bankruptcy.
 
Jun 2007
517
270
USA
#4
The OP is inaccurate, misleading and a blatant attempt at solicitation of business. Credit Unions are treated no differently than any other secured or unsecured, non-priority creditor in bankruptcy. You should consult with a bankruptcy lawyer for advice on the law, and not rely on internet spam.
 
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