By law, under the Bankruptcy and Insolvency Act and the Bank Act, providing you meet the bank’s identification and other criteria, you have the right to open an account at any bank doing business in Canada.
However, in reality it is a wise idea to open a brand new account in a bank that you have never previously had an account or a credit card before you file for bankruptcy or a consumer proposal. Once you have opened your new account, arrange to have your pay cheque or any other direct deposits switched over to this new account. At this point, any money you have in other bank accounts should be placed in the account you just opened.
This is done because your old credit agreements probably gave the lenders the right to take money from your bank accounts if you didn’t make payments. Even though they are not supposed to debit your accounts after you have filed for bankruptcy or a consumer proposal, slip-ups can happen and you don’t want to find your bank account emptied when you were expecting to pay bills or buy groceries.
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