when can a bank account be frozen?

[violetcat65]

Just wondering if a bank account can be frozen without a judgement against you? I have been sent to arbitration and I know they have to go to a local court to sue once they have won the arbitration, but I want to know if its possible for them to freeze the bank accounts before a judgement has been handed down. I have alot of automatic payments set up and this would really screw things up not to mention all the returned payment fees that would accrue.

[HHM]

It's possible, they can get an order from the court ordering the bank to freeze assets (but the court may not grant it) before getting the judgment, but that tactic is rarely, if ever, used in consumer collections because it takes just as long to get the judgment as it does the Order. Plus, your exemptions still apply anyway.

Honestly, I have never seen or heard of this tactic being done to collect a run-of-the-mill consumer debt.

The standard procedures is

1. Arbitration
If the creditor wins at arbitration...
2. The arbitration order is submitted to the court to be turned into a judgment. (this stage is really a formality, it's not quite a lawsuit).
3. Court issues judgment
4. Creditor, with the judgment, garnishes wages and bank accounts.