I am in the process of filing Chapter 7 bankruptcy. We have a checking account with a $1000 credit line. We are putting the credit line on bankruptcy, but in meantime bank took out $49 payment even though balance was 0 and overdrafted us. Now they closed our account. We tried opening new account and were denied. What are our options; will anybody open an account for us? How long will this affect us?? Just when we thought we hit rock bottom it got worse!
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Bankruptcy will stay on your credit report for seven years. You chose to liquidate your debts, and that means lenders who took a risk on you, lost the money you owed them.
You will have to get your financial affairs in order before any other reputable lender will be willing to take a similar risk. You should be able to shop around and find a bank that offers plain vanilla checking and savings account without any lines of credit or overdraft capabilities tied to them. These features associated with an account are forms of loans. Staying away from them means less risk to the bank.
Some banks do credit checks of one sort or another for deposit accounts. Not all do. Those that do may refuse to open a relationship with you. That is their right, but you can find a bank or credit union that will be able to accommodate your needs. You will need to crawl before you walk again, meaning that a plain checking account is needed before one with any credit features. It will take time.
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Bankruptcy will stay on your credit report for seven years. You chose to liquidate your debts, and that means lenders who took a risk on you, lost the money you owed them. 