Q: Why were my voluntary payroll deductions returned to me from my credit union when my bankruptcy notice went out?
I have a voluntary payroll deduction to my credit union. The money is split between three accounts - a savings, a club, and a loan. My attorney sent me a check and letter from my Credit Union which stated they were returning the money to comply with Bankruptcy law. It's everything that's been deposited or paid from as far back as three months prior to my bankruptcy. Are they required to send this back to me as they said? I wanted to keep paying this loan and stay in good with the CU so I could continue to borrow in the future. I filed Chapter 7 if that makes a difference.
A: The payments within 90 days of your filing bankruptcy would be considered a preference under section 547 of the Bankruptcy Code. You may go back and pay the credit union after your bankruptcy completes if you wish to. Discuss with your lawyer if you have further questions. This is very normal and occurs all the time. Nothing to worry about. Good luck!
Justia Ask a Lawyer is a forum for consumers to get answers to basic legal questions. Any information sent through Justia Ask a Lawyer is not secure and is done so on a non-confidential basis only.
The use of this website to ask questions or receive answers does not create an attorney–client relationship between you and Justia, or between you and any attorney who receives your information or responds to your questions, nor is it intended to create such a relationship. Additionally, no responses on this forum constitute legal advice, which must be tailored to the specific circumstances of each case. You should not act upon information provided in Justia Ask a Lawyer without seeking professional counsel from an attorney admitted or authorized to practice in your jurisdiction. Justia assumes no responsibility to any person who relies on information contained on or received through this site and disclaims all liability in respect to such information.
Justia cannot guarantee that the information on this website (including any legal information provided by an attorney through this service) is accurate, complete, or up-to-date. While we intend to make every attempt to keep the information on this site current, the owners of and contributors to this site make no claims, promises or guarantees about the accuracy, completeness or adequacy of the information contained in or linked to from this site.
