Will Bankruptcy Remove You From Chexsystems?
Date: Tue, 12/18/2007 - 17:47
Recently many people have been asking me about Chexsystems and bankruptcy. In this situation again you must remember that Chexsystems is a credit reporting agency. The same as bankruptcy will not erase a collection on Equifax, Experian, or Transunion, it will not remove your name from Chexsystems.
Most people believe that they will be able to open a checking account and get a fresh start after bankruptcy. This is not true. Bankruptcy can help with bounced checks but it doesn’t solve all the problems. You can discharge bad check civil liability but not potential criminal liability. And it will not get you out of Chexsystems.
A check is a promise to pay. Debt can be wiped out in bankruptcy so long as the court doesn’t conclude you intentionally defrauded the person you wrote the check to. This is the civil liability side of things.
In most states, passing a bad check is also a crime. Bankruptcy will not stop the person that the bad check was wrote to from filing criminal charges. Most times criminal charges are never filed because it is extremely difficult to prove the intent to defraud.
If criminal charges are filed, the automatic stay will not normally even slow down a prosecutor. It is common for prosecutors to use the threat of prosecution to collect bad checks for local merchants. Some courts have held that prosecutors can be stopped from collecting debt with bankruptcy. But other courts completely disagree and will not intercede to stop prosecutors. You should consult with an attorney in your area about these issues and not assume that filing bankruptcy is the end of the problem with bad checks.
Recently I have had a few people inform me that they were able to be removed from Chexsystems after a bankruptcy by asking the reporting bank to remove them. They were asked to send in copies of their discharge papers and also to show where the debt was included in the bankruptcy. This may be a route you want to try if you have filed a bankruptcy. Chances are it will NOT work but it is worth a shot.
Most people believe that they will be able to open a checking account and get a fresh start after bankruptcy. This is not true. Bankruptcy can help with bounced checks but it doesn’t solve all the problems. You can discharge bad check civil liability but not potential criminal liability. And it will not get you out of Chexsystems.
A check is a promise to pay. Debt can be wiped out in bankruptcy so long as the court doesn’t conclude you intentionally defrauded the person you wrote the check to. This is the civil liability side of things.
In most states, passing a bad check is also a crime. Bankruptcy will not stop the person that the bad check was wrote to from filing criminal charges. Most times criminal charges are never filed because it is extremely difficult to prove the intent to defraud.
If criminal charges are filed, the automatic stay will not normally even slow down a prosecutor. It is common for prosecutors to use the threat of prosecution to collect bad checks for local merchants. Some courts have held that prosecutors can be stopped from collecting debt with bankruptcy. But other courts completely disagree and will not intercede to stop prosecutors. You should consult with an attorney in your area about these issues and not assume that filing bankruptcy is the end of the problem with bad checks.
Recently I have had a few people inform me that they were able to be removed from Chexsystems after a bankruptcy by asking the reporting bank to remove them. They were asked to send in copies of their discharge papers and also to show where the debt was included in the bankruptcy. This may be a route you want to try if you have filed a bankruptcy. Chances are it will NOT work but it is worth a shot.
