Can a creditor seize your bank account?
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  1. #1
    Join Date
    Mar 2008
    Posts
    26

    Can a creditor seize your bank account?

    I've heard of people having their bank accounts completely wiped out by a creditor. I received a letter from an attorney 2 weeks ago regarding a repo'd car from 2 and a half years ago. I am going to send a DV letter this week. I feel in the end I am going to be sued over this. I fear making any deposits into my account because of this. Is a judgment needed in order for a creditor to get into your bank account or can they just come in and wipe your checking account?


  2. #2
    Join Date
    Jul 2003
    Posts
    2,133
    To sieze assets, a creditor must have obtained a legal judgement, and gone through the steps of execution of it. So, yes a creditor can "wipe out" your account, but you should have plenty of advanced warning with notices of suit, summons, etc.

  3. #3
    Join Date
    Nov 2003
    Posts
    662
    Quote Originally Posted by bizwiz41 View Post
    To sieze assets, a creditor must have obtained a legal judgement, and gone through the steps of execution of it. So, yes a creditor can "wipe out" your account, but you should have plenty of advanced warning with notices of suit, summons, etc.
    Ummm ... not so fast.

    Texas and a couple of otherwise debtor-friendly states I don't recall right now have a weird (to all of us--to them it's commonplace) mechanism for pre-suit attachment of bank accounts. That's right--they grab your bank account just before they sue you, then it provides a fund for the settlement when they win.

    In actuality, this sort of thing is on the books in most states, but in states where creditors have decent post-judgment remedies (like wage garnishment) courts simply don't allow it unless the creditor can prove some hyper-compelling reason to do it.

    In Texas, the legislature provided that reason by closing most other avenues.

    Has the OP used that bank account in dealing with the creditor who may sue? Has the OP answered any surveys about his banking lately (rusing/pretext calls from the attorney's office posing as a survey taker)? Has the OP deposited any small checks from obscure sources (trojan checks)?

    A lot of this sort of investigation is done before the suit (or even the dunning), even in states where the pre-suit attachment isn't widely practiced.

  4. #4
    Join Date
    May 2001
    Posts
    383
    Can a creditor seize a joint account if only one of the account owners has a suit against them?How does the creditor know which funds are the debtors?Plus what if a debtor has several saving and checking accounts opened jointly or seperately can one judgment order seize or freeze all of them?I have read where a debtor had a large negative balance put on their checking account because they had no funds in their checking account.I don't see how a bank would agree to that.What is the purpose of doing that?The debtor is not going to deposit any money into that account in the future and the bank can't sue the debtor to bring that negative balance current since the debtor never made any large withdrawal to cause such a negative balance to happen.I don't think the other joint account holder could be held liable.

  5. #5
    Join Date
    Jul 2003
    Posts
    2,133
    Quote Originally Posted by flacorps View Post
    Ummm ... not so fast.

    Texas and a couple of otherwise debtor-friendly states I don't recall right now have a weird (to all of us--to them it's commonplace) mechanism for pre-suit attachment of bank accounts. That's right--they grab your bank account just before they sue you, then it provides a fund for the settlement when they win.

    In actuality, this sort of thing is on the books in most states, but in states where creditors have decent post-judgment remedies (like wage garnishment) courts simply don't allow it unless the creditor can prove some hyper-compelling reason to do it.

    In Texas, the legislature provided that reason by closing most other avenues.

    Has the OP used that bank account in dealing with the creditor who may sue? Has the OP answered any surveys about his banking lately (rusing/pretext calls from the attorney's office posing as a survey taker)? Has the OP deposited any small checks from obscure sources (trojan checks)?

    A lot of this sort of investigation is done before the suit (or even the dunning), even in states where the pre-suit attachment isn't widely practiced.
    For some clarity, do these laws state "attachment", or (in layman's terms) allow garnishment? In other words, can the creditor "actually" take the funds, or are they "frozen" until a court ruling?

    Curious about this one...

  6. #6