BANK ACCOUNT: ZERO AMOUNT!
(Creditors Can Legally Wipe You Out)
If you’re sued by a bill collector your bank account could be an endangered species. If someone to whom you owe money sues you and gets a judgment, this gives them a legal right to enforce that judgment through means such as wage garnishment, asset seizure and sale and the like. There are limits by law as to how much can be garnished, protecting at least part of your paycheck, and usually there are limitations on asset seizures.
However, as recently reported by National Public Radio (“NPR”) and based on a study by ProPublica ADP, in most states, there are no such protective limits on bank accounts. So, for example, the judgment creditor could garnish approximately ¼ of your paycheck and then also turn around and completely wipe out your bank account.
There are lessons here. First, if you are sued, do not ignore it. Many people do not bother to show up in Court or timely file responsive papers with the Clerk of the Court. Sometimes it’s because they are in denial; sometimes it’s because they can’t get off work; and sometimes, it’s because they didn’t know about it.
The lawsuits and/or hearing notices get lost at your house before being seen or read, they may have been delivered to someone at your residence who forgot to give them to you, or whatever. It doesn’t matter. No timely response; you lose. Even calling up the Plaintiff or the plaintiff’s lawyer and “making arrangements” to pay may not help. There is nothing to stop them from “settling with you” and then proceeding to enter a default judgment anyway unless you have complied with timely responsive pleading filed in the right court. Next thing you know, your bank account is empty and you can’t buy groceries.
Two things that can help are getting notice and getting advice. Most states now permit lawyers to advertise and market their services. Law firms such as Pollak, Hicks and Alhejaj, P.C. subscribe to services that provide them with lists of all lawsuits filed and they send notice letters advising the person being sued. This will give the debtor time to get advice and to respond.
Sometimes you need legal help. Other times, after a free consultation, you will be able to respond appropriately yourself. But make sure you find out which BEFORE your once fat Bank Account ends up with Zero Amount. This has happened to millions of people. You can listen to the whole story, including people right here in Omaha at www.NPR.org.
© David G. Hicks, Attorney at Law