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cross collateralization question
As I recall, most credit unions have a cross collateralization clause in
their membership agreement. So, if a debtor files a chapter 7, any balance
the credit union has in debtor's saving account is secured collateral
against a credit card debt. Which means the saving balance is applied to
the credit card, and only the remaining balance on the credit card is
discharged. Or if collateral exceeds the debt, the excess collateral goes
to the bankruptcy estate for administration or exemption.
Do I have that right? Can anyone point me to the authority that supports
this?
Larry Webb
California Board of Legal Specialization
Certified Specialist in Bankruptcy Law
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