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Can I Have A Bank Account If Bankrupt?
Basic Accounts in Bankruptcy
One of the more popular questions I get asked is about having a bank account whilst bankrupt.
As being bankrupt you still have bills to pay, the rent, council, etc and also a place to have wages and benefits, etc, paid into.
The answer is a resounding, YES, you can have a bank account whilst bankrupt.
You are allowed a basic account, one with no access to credit or an overdraft.
There are a couple of banks that will allow bankrupts a basic account as long as you do not owe the bank and/or have them listed as one of your creditors; unfortunately this list changes, so it is very difficult to state here which of those banks will accept bankrupts.
However, if you already have a basic account, you can inquire with your bank as to if they will allow you to continue the account if you are bankrupt.
The next question is usually, when should I open this new account?
It seems to reason you need it prior to going bankrupt, as all your accounts will be frozen once the Official Receiver sends out their notices.
However, even a basic account may be frozen until the OR is aware it is a basic account.
Now, I have been informed that if you have a basic account and it is frozen, it will be thawed, once the OR is aware or notified it is a basic account.
I have also been advised that if it is a basic account and it is frozen, the bank is to still allow priority direct debits and standing orders, such as rent, utilities, council tax, etc to be deducted as to not disrupt the flow of services to priority bills.
These are good things to know as you still need to pay these priority bills and also eat.
It has been queried about using another person’s account and having your wages and the such paid into it; while you can do this, if you can have your own account why would you not want to, and if that other person’s account has your name on it, you need to disclose it in your bankruptcy and then it will be frozen.
So best maybe to stand alone on this one.
If you have a bankruptcy question you’d like to ask, just ask using this online form. All help is free.
Source: Can I Have A Bank Account If Bankrupt?