Some debtors are under the impression that they will automatically lose their credit union account when they file bankruptcy. In most cases, you’ll get to keep your account but it depends on whether or not you owe the credit union and what your intentions are for making payment on what is owed. There are certain reasons, however, in which you could lose your account.
One of the reasons why so many consumers utilize a credit union is because they are membership organizations that offer benefits the banks do not. More people have a better chance of obtaining a loan from a credit union than at a bank. Plus, credit unions offer more personalized services than a national bank. Yet, consumers may not realize that a credit union may consider you a risk to other members if you cause a loss to the union.
Usually, a credit union will allow you to keep your account upon filing bankruptcy if you don’t have an outstanding balance with the credit union. As long as you are not considered to be causing the credit union a loss, your account should be okay. Keep in mind, the credit union may incur a loss if you file bankruptcy and you include debt the union is owed in your filing.
But, in many cases, you may be able to settle on a payment agreement with the credit union during your bankruptcy which may allow you to keep your account despite the filing. This may allow you to keep a credit card or vehicle loan you have with the union along with checking or saving accounts. Review credit union policy details for more information.