Can the bank freeze disability money?

Question

My mother-in-law has lupus, and is recieving disability since she can't work anymore. This week, her disability check was direct deposited in her account, but as soon as it was, the bank froze it due to a car payment being late. She says that when she applied for SS, they told her that no one could hold her money or freeze it. Is this true?

The car loan was originally under her's and her husband's name. At the beginning of last year, My father-in-law took her name off it, and put my husband's name on it, since it's his car. That way, he would get credit while his dad was still paying for it until the end of college.

Answer 1

Actually the bank can put holds" freezes" on funds if payment is due, overdrafts, fraud and possible check kiting.
when she applied for the car loan did she state that she was disabled? How was she going to pay the loan? If she used her disability as a form of income, then she is responsible to pay the loan. The bank wants to get paid so they will get their money any way they can. Also in order to have a freeze on an account, the payment must have been late at least 60-90 days. If a loan is not payed as agreed the bank can Reposes the car, put a hold on any other asset(s) until the debt is fufilled.

Answer 2

I have never heard of someones bank account being frozen because of a car payment being late--maybe it can happen, I don't know. But, is it possible that your mother-in-law gave them(bank where she purchased her car through) permission to take the car payment from her checking account?

Answer 3

I'm pretty sure they can't. It's a bank, they know what the source of the income is...

You can always look for an attorney on naca.net

Answer 4

Apparently the bank thinks they can.