What will happen to my bank account if I'm made bankrupt?
Bankruptcy and bank accounts
This section covers the questions you are most likely to want answered about your bank account if you are made bankrupt:
When you are declared bankrupt, you must stop using your cheque book and bank cards, and immediately surrender them to the Official Receiver.
Accounts are normally frozen by the bank when they are told about your bankruptcy by the Official Receiver.
Some banks allow bankrupts to continue to use existing accounts. Even if the bank agrees to this, they will freeze the account when they become aware of the bankruptcy order, service may be restored, but no overdraft or borrowing facilities will be provided.
Use our Free Online Bankruptcy Qualification Check to see if Bankruptcy could be the right option for you.
Bank Accounts In Credit At Bankruptcy
Money in any bank account in your name at the date of the bankruptcy order is an asset in the bankruptcy.
If you have a joint account, the Offical Receiver will decide how much of the money to release to each of the joint account holders.
Bank Accounts Overdrawn At Bankruptcy
Any overdraft will be included in the bankruptcy.
For bank account is in joint names, all parties are jointly responsible for the whole debt. This is the same for any joint credit agreement. Therefore the bank can ask the joint account holder facing bankruptcy to pay all the money owed.
Bank Accounts During Bankruptcy
A non discharged bankrupt can apply to open a new Bank/ Building society account, but they must inform the bank they are a serving bankrupt.
Banks/Building Societies are not obliged to grant an account, but if so, it is likely to be a basic account without credit facilities. These types of accounts can be quite hard to get as they are not profit making for the Banks and therefore is often unaware of their existance.
Need Bankruptcy Advice?
Our specialists can quickly advise you on what to do if you are considering going bankrupt. Simply call the team FREE on 0800 368 8133. Alternatively take the online bankruptcy test and check if you qualify.
I Contacted them at 5 pm on a Thursday night,they arranged a meeting Friday morning with all the relevant bodies their because my case was the following Monday .I can't sing their praises high enough they contacted the courts same afternoon. Fantastic response, I avoided bankruptcy on the Monday and was given time to arrange an Iva. I risked losing my home,my mother and fathers home all hope seemed lost until I made that fateful phone call. I can now sleep at night.
Join 100,000s of Money Advice Onliners who read our WEEKLY email. Get our round up of ALL the best money saving tips, best buys, discount vouchers and competitions. Don't miss out!
Moneyadviceonline.co.uk is a comparison service that acts as an introducer to companies who offer regulated financial advice (FCA approved). Our website is completely free for you to use but we may receive a commission from some of the companies we feature. Moneyadviceonline.co.uk does not provide any advice and we are not liable for any financial advice provided by, or obtained through a third party. As with any investment, the value of investments can fall as well as rise and maybe worth less than what was paid in. Past performance is not an indicator of future results.
Moneyadviceonline.co.uk does not provide any regulated debt activates in relation to debt counselling or adjusting. You can also get free impartial debt advice by following this link to the Money Advice Service.