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  1. #1
    Rhiannon is offline Junior Member
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    May 2008
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    Bank account frozen - any use to apply for a new one elsewhere?

    What is the name of your state? New York

    I have been out of work for three years and due to multiple health issues, it is unlikely that I will be able to work outside my home for the foreseeable future, if ever. I am trying to put together a home-based source of income but nothing has come of it yet. For now, my family is helping me with small loans to pay for day to day expenses, and my wonderful landlord has allowed me to stay here without paying rent, trusting that I will repay him when I'm able to.

    I had several major credit cards, plus a large student loan, at the time I left my job three years ago. I immediately stopped using any of the cards and I am not in default on my student loan, I conscientiously follow their rules in applying for deferments.

    Even though I notified my creditors that I am not employed nor at the moment employable, and I have no assets, I have already been sued by two of them and have been served papers by a third. The first two have obtained default judgments and one of them seized my bank account. Actually, the bank took the money (less than $10) as a legal fee and so the creditor got nothing at all.

    Having my bank account frozen like this has been a great inconvenience but I have coped. Using money orders for purchases and physically paying cash at my doctor's and dentist's offices, at the grocery store, etc. But it is somewhat difficult to get around and also there are things I need that would be much less expensive to obtain online, but I can't order them because I have no bank account or debit card I can use.

    I have struggled to avoid going on welfare or trying to get disability. I believe with the help of my family I can remain independent and eventually be able to support myself from a home-based business. I know that filing bankruptcy will get these creditors off my back and the bank account will no longer be frozen. But I can't even afford bankruptcy right now and the issue for me isn't securing my assets -- I don't have any assets these creditors or even a bankruptcy trustee would be interested in.

    My question is, can I open an online banking account, say at WaMu, and if so can the creditors seize that account also? I have read that it is difficult for creditors to seize your bank account if it's in a different state than the one you were sued in, and/or if you have never written them a check or in some other way disclosed the bank and the checking account information to them.

    Will having a bank account frozen like this cause another bank to refuse to open an account for me? I have never had a bounced check at this bank and I have been their customer for 20 years.

    I will appreciate any advice you can offer. Thanks!
    Last edited by Rhiannon; 05-13-2008 at 01:28 PM.
  2. #2
    Susie39 is offline Junior Member
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    You can open another account but when they find out about the new account, that can be frozen as well. It is showing you have assets and assets is what they want.
    Seeing that you have multiple health issues, why aren't you seeking Social Security disability? I noticed that you stated you were trying to stay away from it. It would be a lot easier on you as well as your family if you were getting some assistance. Remember, pride is for fools. You need the assistance and have a legitimate reason for getting it, so go for it.
  3. #3
    Antigone* is offline Senior Member
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    Quote Originally Posted by Rhiannon View Post
    My question is, can I open an online banking account, say at WaMu, and if so can the creditors seize that account also? I have read that it is difficult for creditors to seize your bank account if it's in a different state than the one you were sued in, and/or if you have never written them a check or in some other way disclosed the bank and the checking account information to them.

    Will having a bank account frozen like this cause another bank to refuse to open an account for me? I have never had a bounced check at this bank and I have been their customer for 20 years.

    I will appreciate any advice you can offer. Thanks!
    Hello Rhiannon

    Any account you have in your name can be levied if the financial institution is served with the correct documents.

    With regards to the account you have now, if you let is close with an overdrawn balance (and depending how much overdrawn) you may have trouble opening a new account.

    I know that cash is inconvenient, but you may want to try to use a pre-paid Visa or MC until you can get things straightened out.

    I hope this helps. Take care, ana
  4. #4
    Rhiannon is offline Junior Member
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    Quote Originally Posted by Susie39 View Post
    You can open another account but when they find out about the new account, that can be frozen as well. It is showing you have assets and assets is what they want.
    Seeing that you have multiple health issues, why aren't you seeking Social Security disability? I noticed that you stated you were trying to stay away from it. It would be a lot easier on you as well as your family if you were getting some assistance. Remember, pride is for fools. You need the assistance and have a legitimate reason for getting it, so go for it.
    Your point is well taken. However, there are several obstacles. Time is one big factor. It would be seven months after applying before I would get any money from SSD, even if my application did get approved on the first go, which isn't likely. You have to have been regularly seeing a doctor or they consider that you're not that bad off. But seeing a doctor would mean going on welfare to get Medicaid. I've been through that humiliating process twice before in my life, both times for health reasons. Maybe pride is for fools but it's about all I have left.

    Any account you have in your name can be levied if the financial institution is served with the correct documents.

    With regards to the account you have now, if you let is close with an overdrawn balance (and depending how much overdrawn) you may have trouble opening a new account.

    I know that cash is inconvenient, but you may want to try to use a pre-paid Visa or MC until you can get things straightened out.

    I hope this helps. Take care, ana
    My account isn't closed, Ana, it's just frozen. If I put any money in it they would have to turn it over to the creditor who put the hold on it. Unless it's exempt money, like public assistance or Social Security, or wages to a certain amount. But anyway, my account's not overdrawn, it's just got a zero balance until and unless I'm stupid enough to put any more money in it while the creditor holds the keys.

    How would a creditor know to serve any papers on a new financial institution if they don't know I have an account there? They couldn't very well serve papers on every bank in the country.

    Your suggestion about a prepaid Visa or MC is one I hadn't thought of. But, if I don't have a bank account I can use, would I even be able to get one?

    Thanks to both of you for taking the time to advise me.

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