The recent spate of bank collapses has left many people extremely concerned, as the money they had in the bank - in savings accounts, cheque accounts, and other accounts - has been frozen. Money that they expected to be able to draw from is not available, and whether or not they will be able to get their hands on the money is still up in the air. According to the Financial Services Compensation Scheme, repayments to some accounts were supposed to start in November 2008, but money that is trapped in offshore bank accounts, in bonds, or in other types of accounts are still waiting to be paid. And that's if they get repaid at all. In order to get your hands on your money and keep your creditors off your back, you need to have a plan in place.

The first thing you need to do is make sure that you continue to pay your creditors and do not skip a payment. This will only cause you to incur late fees, penalties, and interest, and this will be reported on your credit record. The next thing you need to do is access your frozen account online and take a screenshot of it or copy any documentation the bank has sent you, stating that the account has been frozen so that you can show it to your creditors when you call them to renegotiate your payments. They will be more willing to work with you if you can show them that your money is frozen and inaccessible.
If you have a bank loan or credit card through the collapsed bank, they should be willing to work with you until your money is returned to you. You should expect them to be sympathetic to your cause, and you can ask them to freeze your interest or allow reduced payments until the money is back in your pockets. If you had money earmarked for a tax bill that is frozen, contact the HMRC immediately and let them know what is going on. They will grant you extra time to pay the bill.

Closing on a home is another situation many people are facing, and the Council of Mortgage Lenders is leaving this up to the individual lenders to handle because there is no policy in place to handle this type of situation. You need to contact your new mortgage lender or broker and arrange to have the closing pushed off to another date, or taking out an interest free payment holiday so that you can get into your new home. This will make you have to pay more in the long run, but it will not hurt your credit and you will not have to worry about losing the house to another buyer.

Make sure you freeze any direct debits you have going into that account, and let the lenders that you have this service set up with know what is going on. This is a good time to clear up your debts and your financial records while you wait for your money. Close down any old accounts you are not using, and check for errors on your credit report.