Another Account Freezing Question...

[Txgirl]

This is a spin-off of my other thread.

I live in Texas. Creditors can get a pre-judgement and freeze your account.

The only account we have is our checking account that the checks go in and the money goes out to pay bills.

I spoke with a bankruptcy lawyer today who stated that was a meticulous procedure and it *usually* doesn't happen (not to say it would.)

So....what is the likelyhood of it happening pre-judgement? How soon after you start receiving calls could it happen?

On a side note. My inlaws are always defaulting on cc and loans and not once in 11 years have their accounts been frozen and my mother in law has been sued 1x.

[rockyroad]

I'm wondering this myself. Just got served by AMEX and still a ways off from being able to file. I'm wondering how to protect my checking account.

[All Cash]

I'm wondering this myself. Just got served by AMEX and still a ways off from being able to file. I'm wondering how to protect my checking account.

Take the money out and use money orders.

[Txgirl]

I read somewhere that it's a very meticulous process that creditors have to follow plus it costs them money.

IDK? Like I said, my inlaws have been dealing with collections people for 10+ years and I have never heard of their accounts being frozen.

All Cash- Tell us how you do it? Paper (pay) checks and then pay everything with MO?

[treehugger1]

Txgirl, There are dozens of prepaid debit cards on the market today. You can google this and find them. You can put money on the cards through WU, VISA interlink, AccountNow, Ready Debit, moneygram, etc. Many of these cards have a bill pay service. Some cards allow up to $10K to be carried. They are somehow, somewhere tied to a bank somewhere in the US, but unless you tell your OC or CA that you have a debit account with routing number and parallel account number, it is incredibly difficult to uncover the accounts. In fact, most of these cards will state that "this is not a bank account." Good to know if you are called in under exam and asked to decribe your "bank accounts." Since such cards are tied only to "cash," my feeling is that represent a possible answer to a "cash on hand?" query. Treat them as cash as that is what they attempt to sell you. If you are asked about cahs on hand, and you have only $20 available, then there is your answer. The fact that the "non-traditional" debit card business seems to be booming suggests to me that there are many folks who would rather pay a $10 fee to have a cash/bill pay account than are/can have a bank account. As always, do your own due diligence. But, there are many opportunites in the US for VISA/MC that don't directly tie you to a bank account, unless you ask for the information. It can't hurt, in troubled economic times, to be a "least-sophisticated" consumer. Just an opinion.

[Txgirl]

Thanks so much for the info!

So I have a question, if you are sued and go to court, I have been reading about a form they request you fill out regarding your information, such as bank accounts, etc.

So if you put in your bank account info b/c apparently if you don't you are in contempt (said bank account is a checking account) that your paychecks go in and then go right back out to pay bills.

What is likely to happen?

[treehugger1]

If you are concerned about bank account info, then I would go strictly to a paper-copy paycheck. You might be able to open up a savings account at a local bank that will then cash your check. You can then buy money orders, prepaid debt cards, etc. If your employer requires direct deposit, then this might create a probnlem.

I'm not knowledgeable about how bank levies work in TX. In some states, such as mine, the levy is only good for the day the bank receives the writ. My account cannot be frozen for any extended amount of time.

If you are served interrogatories related to a suit after judegment, then you are obligated to fill them out an dreturn them. You can certainly fill them out and return them, and then the next day open a new account at a different bank. I'm not sure how many times a legal firm is willing to play this game if they don't ever get any money.

Best approach is to go to paper paycheck, or declare BK and shut them all down.

[Txgirl]

Thanks again for the info!

We don't have any savings, just our checking that pays the bills. I stress alot of this stuff, my husband is very nonchalant!

I was told in Texas that it's a very tedious process and costs the creditor/CA money to do this.

Can't file BK..they are private SL.

[FU2MI]

how many times can they freeze the account? only once (per judgment) or as many times as they are willing to file?

[Txgirl]

how many times can they freeze the account? only once (per judgment) or as many times as they are willing to file?

Good questions...I am curious to know too!

It is automatic that if they get a judgement your account will be frozen?

[treehugger1]

they can probably hit your acount as oftern as they like. If they get "burned" a few times and there is no money for them, it can get costly for them to keep attempting a bank levy.

I think some states allow for a "frozen" account, while for other states the levy is a one-time thing (they can levy the account again, but they need to pay to have it served again.)

In the same manner some states have a very long time period asigned for continuing wage garnishment, while other states have 90 day period, after which the creditor/CA must file and pay for a new writ.

[Txgirl]

I was told that there is a lot of paperwork involved and it usually costs the creditor money.

Wouldn't that be more beneficial for someone who actually has money (large sum) in an account?

Not just the person who's monthly check goes in and right back out to pay bills.

Treehugger- I am in TX and know they can freeze an account pre-judgment. Do you know of any resources where I can read about this?

[treehugger1]

You can try googling "Texas debtor bank levy laws" and see what you get. I learned about banklevies in my state from another poster who also resides in Oregon on this board. I sleep better at night because of this board

[floridian]

i was just reading on a lawyers blog, his opinion on florida bank disability garnishment...

he stated that although SS and disability is not garnishable, they are not protected once you deposit it in a bank account, as per the letter of the law....

not good...

[2Bshinyandnew]

i was just reading on a lawyers blog, his opinion on florida bank disability garnishment...

he stated that although SS and disability is not garnishable, they are not protected once you deposit it in a bank account, as per the letter of the law....

not good...

Where did you read this, Floridian? Do you have a link? I was told by a BK attorney that child support money, if segregated in a separate account would be safe from levy. SS and disability are viewed the same way as child support, correct?

The attorney told me as long as every penny in the account was child support and no other money was comingled he could protect it from levy in the event of a lawsuit and as an exempt asset in BK. I opened a brand new checking account last year just for this purpose at a bank I had never done business with and have my son's child support direct deposited in that account.

I check my county clerk website every day to see if anyone has filed a lawsuit against me yet.

Oy. I cannot wait until I can file BK and stop looking over my shoulder.