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Can you have a Bank Account while you are Bankrupt?
You can have a bank account in your own name if you go bankrupt. However it will need to be a Basic account. This type of account normally comes with internet banking and a debit card but no credit facilities.
If the account you are using at the moment is a basic one and you do not owe the bank any money you should be able to carry on using it. The account will normally remain open during your bankruptcy.
However if you have a current account this will probably be frozen and then closed. You will need to open a new basic account to use instead.
Most high street banks offer basic accounts for free (e.g. TSB Cash Account, NatWest Foundation, Nationwide Flex Basic) and will keep the account open during your bankruptcy.
When to open a New Bank Account
A new basic bank account can be opened either before or after you go bankrupt. Most banks will let you open such an account beforehand if you wish.
Generally speaking it is preferable to open the new account before you apply. This way you can start to use it and not be concerned about having a period where your old account is frozen before the new is opened.
If you do not owe money to your bank you can speak to them about simply switching from a current to a basic account. They may do it for you there and then or ask you to come back to them once you are bankrupt.
Most high street banks will open a basic account for you before you go bankrupt. However some may only be able to do so after your application is accepted.
Can you use your Partner’s Bank Account while you are Bankrupt?
You do not need a bank account in your own name while you are bankrupt. There is nothing to stop you using your partner’s account if they are happy for you to do this.
It is possible to have your wages and other sources of income paid into another person’s account. The account holder can also set up direct debits on your behalf to ensure any regular payments are maintained.
Having said that using someone else’s account is generally less convenient than having your own. In addition once you are discharged it will be less easy to start repairing your credit rating without your own bank account.
If you are planning to go bankrupt do not add your name to your partner’s account. It might put the account at risk particularly if it is a current account.
Bank Account options After Bankruptcy
There is nothing to stop you applying for a new bank account after you are discharged. At this time you can apply for a basic account with virtually any bank.
However it it likely to still be some time before you are allowed to open a current account. Most banks will normally require that the record has come off your credit file before allowing you to have one of these accounts.
Although you may be able to start improving your credit rating after you are discharged the record of your bankruptcy will not come off your credit file until 6 years from the start date.
Before you can apply for a standard current account you will normally need to wait until the record of your bankruptcy has come off your credit file.