What account are less likely to get targeted?

[jp2861]

What accounts are usually targetted by collectors if they decide to try to clean someone out? Based on reading some posts here it sounds like checking accounts get hit frequently. Are there other accounts that are safe from these guys? I want to have my military pension direct deposited in an account but I want to make sure it's safe from the collections types. My military pension is protected from garnishment as Veterans Benefits but if these guys are as hardcore as I'm reading I'd like to make sure I have it protected as much as possible.

Also, how is it that these guys can get away with this? I can see being garnished from a judgement, but can /do these collectors actually get into someone checking account and the bank just sits there idle?

[DivorceRuinedMe]

I think they have to have a judgement before they can take anything. I don't believe a collector can just go into your account and take money out without a judgement in place. Someone please correct me if I'm wrong.

[lrprn]

I think they have to have a judgement before they can take anything. I don't believe a collector can just go into your account and take money out without a judgement in place. Someone please correct me if I'm wrong.

A judgment usually does have to be in place before a creditor can take money from your account. However, one exception to this is if you have an account with a credit union or bank and you also have a credit card or loan with that same credit union or bank with a cross-collateralization clause in the contract.

Cross-collateralization allows the credit union or bank to take money from one of your accounts to pay another. For example, if you don't pay your credit card or loan, they can legally take the money for the payment up to the entire balance owed on the card or loan from your checking or saving account.

This is why you when you are in this situation, you need to get your primary checking and savings accounts changed over to another bank BEFORE filing and BEFORE stopping payment on the credit union's/bank's credit card or non-secured loan.

If you don't have a credit card or loan through the same financial institution as your checking/savings account, then no worries....cross-collateralization won't be a problem for you.

[GoingDown]

If he is worried about getting the money in his checking account seized, he might already have a judgment against him.

The only way to be sure that they can't their hands on your money is to not use a checking account for direct deposit. Try to get paper checks mailed to you and then cash the paper checks and use money orders to pay bills.

Yes, it is inconvenient. But so is having all the money in your checking account cleaned out and then going to court to try to get the judge to order a collection attorney to give you back your money. Even if the money is technically "Exempt", you still will have to prove it to a judge to get your money back, and that takes time and money (to pay legal fees and court costs).


If you insist on having a checking account, make sure that the only deposits made to the account are from an exempt source such as that exempt pension. Do not mix the funds with any other money source, so that you can prove that all of the funds are 100% exempt from judgment creditors.

Depending on what state you are in, you might be able to get a form that declares your checking account is exempt (Arizona has these forms), and you list the reasons, and then file it with the same court that granted the judgment to the creditor. After that you get a certified copy from the court and then have a process server deliver it to the creditor's attorney and to the bank where your checking account is located. This way, if the creditor still seizes your account, you have proof that you tried to tell the funds were exempt and therefore the creditor is guilty of wrongful levy or wrongful execution and you could be awarded damages against them.

[jp2861]

[QUOTE=GoingDown;110418]If he is worried about getting the money in his checking account seized, he might already have a judgment against him.

No, I don't have a judgement against me at this time. However, knowledge is power.

[treehugger1]

You can aso set up a debit account with some of the new systems. I've heard Metabank/Vantage (I think that's the name) offers prepaid cards that accept high deposit amounts. I've alsrecent;ly herd tha perhas WellsFargo, Key bak, etc also now ffer "bank card" only accounts with no credit checks. I'm guessing there must bea NEED and a market for such typesof accounts, LOL. One practical reason for such dbit cards is that there is no credit check associated with them.

[treehugger1]

I regret all of the typos in the previous post. My apologies!