Bank account garnished-Michigan

[Islander133]

Yesterday my son-in-law tried to use his debit card and it was refused. Turns out there was a garnishment on his joint checking account with his wife, my daughter. There was no notice of this garnishment from anyone.

Today we discovered that the garnishment was done by a collection attorney's office that my daughter has been making regular payments to. She had an agreement to make a monthly payment against the debt for a year and then they were supposed to negotiate again. The year is far from up.

Son-in-law feels garnisment is illegal because most of the funds were from his pay and the debt was his wife's before they were married.

Daughter feels betrayed because she has been making regular payments per the agreement.

Can anyone advise them on what to do next? Fees are mounting at the bank and their wages, plus my daughter's children's social security pay will be direct deposited this coming week. They will have utilities turned off and all sorts of problems if they cannot find a way to stop this.

[zippysgoddess]

Well first of all, there is no way this was done without any prior notice, they had to be sued in court (unless it was a state or federal debt) and they had to be served a summons in some manner. By not going to the court hearing, which I am assuming they didn't, a default judgment was entered against them.

It is possible the the whole reason she called the collection attorney was because she received notice of a pending suit on the debt and wished to make some sort of arrangements to avoid that.

It would not be the first time an attorney accepted a payment offer, told someone not to worry about the court date since they had settled the matter and then went through with the court date anyway. If this is what happened, there isn't much recourse because collections people just want their money, it was her responsiblity to either verify the court date was cancelled or to be there and make the judge aware of the recent agreement made.

As to the bank account garnishment, the bank had to see a judges order (like I said unless it was a state or federal debt) to let them do this. The bank has no choice in this case once they are presented with the court order.

Their taking the money is not illegal, no matter whose it was, her husband can however file to get his portion of the money back as well as the children's SS payments by presenting the CA with proof that he has no connection to this debt and that percentage of the money in their was his and the children's SS (SS funds cannot be seized or garnished unless it is a state or federal debt either!)

Their best bet right now is to stop those direct deposit ASAP! It is going to take awhile to sort out and get back the portion of the money that they can get returned to them. Once the CA gets their hands on it, they are very reluctant to ever give it up again.

[Ladynred]

There was no notice of this garnishment from anyone.

Why would there be ?? They have a judgment against your daughter. If they told people they were going to sieze bank accounts people would move the money -- they do not HAVE to notify the judgment debtor of a bank levy.

She had an agreement to make a monthly payment against the debt for a year and then they were supposed to negotiate again. The year is far from up.

Was the agreement in WRITING ?? If not, there essentially is no 'agreement'. If the payments she's making are too small to get the debt paid off in a reasonable amount of time, then they will NOT wait years to get paid.

Son-in-law feels garnisment is illegal because most of the funds were from his pay and the debt was his wife's before they were married.

Its NOT illegal, her name is on the account that is ALL the judgment creditor or the bank cares about. Your son-in-law/daughter needs to immediately appeal the levy with the court and show PROOF what funds were his and why.

Daughter feels betrayed because she has been making regular payments per the agreement.

Again, if it wasn't in writing, it never existed.

Can anyone advise them on what to do next? Fees are mounting at the bank and their wages, plus my daughter's children's social security pay will be direct deposited this coming week. They will have utilities turned off and all sorts of problems if they cannot find a way to stop this.

APPEAL the levy first thing Monday morning by going to the courthouse and asking the court clerk for the forms needed to do so. OR get a lawyer ASAP. They must ALSO file the EXEMPTIONS to protect that social security money.

[debtcollector`]

Yes, file the exemptions and remember that two people on a bank account -- it doesn't matter which one of them puts the money in. Nor unfortanetly for you does it matter if some of that money was SSI. Once you deposited the money in the account and co-mingled it with other funds -- you lose that objection.

Yes, I know. Someone is going to ask for the source of that statement. Hopefully someone will step up and help me out with the source, as I in Florida and leaving the country in the morning -- I'm not going to research it. This net connection is costing me a $1 a minute.

DC

PS -- Back in 2 weeks or so