Why You Should Open a New Bank Account

At Hoyes Michalos we recommend that you open a new bank account at a new bank when you file a consumer proposal or bankruptcy. Why? Because we want you to get a fresh start.

Here are details on which bank you should pick when you open a new bank account.

You probably owe money to your old bank, and many of your old creditors probably know about or have access to your old bank account, so now is the time to start fresh with a new bank account. Here’s the key:

Your new bank account should be with a new bank where you have no unsecured debt, so that your creditors will not have access that account. If you had a bank account at ABC Bank and an ABC Visa card, you don’t want to bank at ABC Bank, because they have access to your old account.

That’s why we strongly recommend that you do the following:

  • open a bank account at a bank that you do not owe money (excluding mortgage or car loans);
  • switch your direct deposits (e.g. payroll, pensions, government benefits, etc.) to this bank account;
  • switch automatic withdrawals for ongoing payments (e.g. insurance, car payments, utilities, etc.) to come out of this account;
  • close bank accounts that you will no longer be using and that have a positive balance; and
  • stop active debt payments in old bank accounts that you are unable to close.

If I don’t do the above:

  • You are responsible for any transactions my bank may process (like automatic payments, post-dated cheques, and bank service charges);
  • If you use an account with an overdraft, you are responsible for paying the entire overdraft, even if my bank cancels my overdraft.

Here are details on which bank you should pick when you open a new bank account.

Please call our office at 1-800-472-7775 or email us at help@hoyes.com if you have any questions.