Keep Savings In A Different Bank From Your Creditors

Banks Sweeping Checking/Savings Accounts to Pay Late Bills

"She is doing well in this terrible market but as with so many, got a bit over-levered during the bubble years and is now spreading it thin trying to keep all of the monthly payments going out. Some months when it is thin, she will chose to skip a payment on a specific card or two to pay other things…but she is paying nevertheless.
Yesterday morning she logged into her Wells Fargo checking and savings accounts to pay bills online and there was a ZERO balance across her accounts. However, her debt was paid down considerably. Immediately she called Wells and they informed her that because she was over 30-days late paying her Wells credit that they drained the accounts in order to pay down the bills.
This is also the second time somebody I know personally has had this happen with Wells – the first had their accounts drained of about $5k to bring current a HELOC payment. Leaving people with zero money and no credit is a drastic measure. Stories like this will get around quickly – it will not be too long before you hear about practices like this on 60-Minutes."