Wednesday, August 10, 2011

Top 10 Reason for Filing Bankruptcy – #2

Frozen Checking Account. I'm sure you've heard the phrase that goes something like, “The most fun you can legally have....” when someone is trying to get your attention to sell you something. Well, I cannot think of anything that can, legally, get ones attention faster than a frozen checking account. And fun? I don't think so. If your checking account has been frozen, there is a good chance someone is trying to garnish the account. So, the first thing you do is call your friendly attorney, and try to understand how anyone could freeze your account without notifying you first. Obviously, if the law mandated you be notified first, freezing an account would not mean much, as there wouldn't be any money in the account by the time the creditor got to it.

Problems? You bet. Not only can you no get to your money, any checks that are outstanding will probably bounce. Then you have an whole new problem. In Florida, the act of bouncing a check can lead to criminal prosecution problems.

Bankruptcy, how can it help? Under Section 362 of the Bankruptcy Code, one is prohibited from commencing or continuing collection efforts upon the filing of your bankruptcy petition. This means the plaintiff in the case which has garnished your account will probably have to release the funds back to you. Please note, this is a general rule, and does not apply in all situations. To find out more about this as it applies to your particular situation, please contact your local bankruptcy attorney.

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