Can a company put a Lien on your account without notifying you?

Question

My husband just discovered his checking account has been wiped out by a collection agency for a credit card that he had 5 years ago. When he called, it turns out that they had a completely incorrect phone number (because they claimed to have been calling us all day), and they never sent him any letters--not even a court appearance letter.

They are now trying to work out a monthly settlement with him, but I told him that he could possibly sue. Can they do that, and can we sue?

Also, can they place a lien on our joint checking account? After all, half of the money in there is mine and I have nothing to do with this account.

Answer 1

Credit cards are virtually always 'unsecured', meaning the credit card company has no collateral from you. The only way they could do this is if they went to court and got a judgement against your husband.

If they have a court judgement, then yes, they can go after your assets. They can also garnish his wages.

On what basis would you sue them?

Assuming you really owe the money, then just suck it up and pay it.

Answer 2

Not surprisingly, I disagree with everyone here!

It will depend on your local court rules...but in many states here is how the procedure goes.

1) You are served with paperwork informing you of your court trial. A good collection agent knows how to work an "alternate service" so that you are actually never informed of the trial. You don't show up, so the win automatically. In many states, (like Michigan and Oklahoma for example), the judge will NOT order defaults unless it can be proven that a diligent search was made to locate you.

2) After the judgment is granted, you are mailed a copy of the order by the court clerk.

3) The creditor then files for a garnishment (lien) against your bank account. A copy is served on the bank, and another copy is mailed to you by certified mail.

The money can not be removed form your account for a certain amount of time (usually 21 days). This gives you time to file arguments against the garnishment with the court.

There is NO EXCUSE for the creditor to not have contacted you. The bank would have had your address and contact information. In our state, the bank must also send you a notice that your account is being garnished.

So somewhere in this process someone violated the law. Whether you have grounds to sue or not I'm not sure, but you certainly have grounds to have the case adjorned and reheard.

But if you actually owe the debt there probably isn't a lot this will solve....all you will do is upset the judge by filing for a re-hearing and waste his time.

If you are simply seeking revenge...look into a lawsuit for improper service.

Answer 3

Any attachment orders must come from a court. What probably happened is that they filed suit in court and since he did not show up they entered a default judgement against him.

Anytime a suit is filed then reasonable attempts must be made to serve your husband. This is usually by a process server deliviering a copy of the suit to your husband. If they do not know where he works or lives, they are allowed to serve by alternate means. This is usually by something like placing an annoucement in a local paper for a set amount of time.

Most likely he did get served as far as the court was concerned, and there should be a proof of service filed with the court. He will have to talk to the local courthouse and ask for a copy of the proof of service for the case. This will tell them how it was done.

I am actually surprised that they are still willing to work out a settlement because once it goes to court, the court has determined he owes the money. So there is no reason they would want to settle for less. If they are willing to settle it might be worth working it out with them.

Since it already went to court and he has a judgement against him, there is really no grounds that he could file suit on.

Answer 4

This is not what you want to hear, but what they did was legal.

To have done this, they must have had a judgment from the court stating that your husband owed the money. Most likely a default judgment from when he did not show up in court.

Not only can they attach bank accounts, they can also garnish wages (if your State allows it) and place liens on any property that your husband may own like cars, boats, land and homes.

You should feel lucky that they are willing to work out a settlement because once they get the judgment, they do not have to.

Answer 5

Presumably, the creditor sued you but you were never properly served. Then they entered a default judgment and an execution based on that, Your remedy would be to go to court and have the default judgment set aside. You would need to have some meritorious legal reason for not paying, otherwise the court will not go through the dance of vacating the judgment only to reinstate it again a year or so later. You may have a counterclaim for a violation of the Fair Debt Collection Practices Act. You should speak to an attorney pronto. FDCPA cases are often done on a no-recovery, no fee basis.

Answer 6

Once they get the judgement they generally don't need to notify you any further before taking action to enforce the judgement.

It appears that you ignored the lawsuit and are now paying the price. If you don't respond to the suit they get a default judgement against you. At the very least you would have taken action to separate out your funds from the account.

Answer 7

Oh, yes they can,
When he applied, did he read the fine print?
When he got the card, was there a letter or brochure with it spelling out the terms of use.?? I'm sure there
was.
Did he 'conveniently forget"he owed them money? They never do.
Sue if you must, but be prepared to lay out a large amount of money as a retainer.

Answer 8

yes is the only answer these attorney collection agencys can put a judgement against you (which they already have) without any prior notice. its scary with all the idenity theift out there you could wind up paying someone elses bill

Answer 9

Actually, yes they can.