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Advice on Bank Levies by Judgment Creditor - The Bills.com Blog
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Advice on Bank Levies by Judgment Creditor
Question: I have a judgment against me that I cannot pay in full or the offered settlement. The firm is levying my account every chance they get which does not help. I tried to make payment arrangements but they tell me even if I send in payments they will continue to levy my checking account. What should I do next? I'm in California. Thanks!
Answer: I understand how frustrating it mustbe to endure these repeated bank levies, especially when you have offered to make voluntary payments to this creditor. Unfortunately, since this creditor has obtained a judgment against you, it has the legal right to levy your bank accounts in order to enforce its judgment. Depending on your financial situation, it may also be able to garnish your wages and place liens on any property you own, including your home. Since the creditor is repeatedly taking money out of your bank account, the simplest solution to this problem may be to change banks; changing your bank should prevent the creditor from taking any more money out of your current account since that account will no longer be open. Your creditor will not have your new bank account information, as you will have never made payments from the new account, so changing your account may offer you relief from the repeated levies you have been experiencing. Unfortunately, this solution may only be temporary, as the judgment creditor may find your new account by communicating with banks in your area or by demanding the information from you through a court order. These steps will take time though, so changing your bank may at least provide you with some temporary relief while you pursue a more
definitive solution to your financial troubles. To learn more about California’s laws related to the execution of judgments, I encourage you to visit this link .
Because this creditor has expressed resistance to your efforts to resolve this debt voluntarily, you may want to consider filing for bankruptcy protection, as bankruptcy may be the only definitive way to prevent any further collection activity by this creditor. There are two basic types of consumer bankruptcy: Chapter 7 and Chapter 13. In a Chapter 7 bankruptcy, also called a liquidation bankruptcy, a bankruptcy trustee will examine your assets, and if you have any assets which are not exempt, sell those non-exempt assets to repay your creditors. Once your non-exempt assets have been sold to pay your creditors, all remaining unsecured debts will be discharged by the bankruptcy court. Many people who file for Chapter 7 protection are able to keep all of their property because they have no non-exempt property. Each state has its own schedule of exempt assets, so you should consult with a qualified bankruptcy attorney in your state to find out if Chapter 7 is a workable solution for your situation. An attorney
will also be able to tell you if you qualify to file Chapter 7 under the new guidelines enacted by Congress in 2005.
A Chapter 13 bankruptcy, also called a “wage-earner’s bankruptcy,” allows you to propose a plan to repay creditors over time–usually five years. Your monthly payment amount will be based on your monthly disposable income as defined by the bankruptcy code. After you have made payments to your creditors for five years, any remaining unsecured debts will be discharged. Chapter 13 is commonly used by debtors whose assets exceed the exemptions offered by state law. It is also used by many consumer debtors who do not qualify for Chapter 7 relief under the means test, which went into effect in 2005 with the Bankruptcy Reform Act.
If you are considering filing bankruptcy, you should consult with an attorney to find out if bankruptcy will benefit your financial situation. I encourage you to read more about bankruptcy at the Bills.com bankruptcy information page.
I wish you the best of luck in resolving this debt, and hope the information I have provided helps you Find. Learn. Save.
Good Luck,
Bill
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