Legal Question in Credit and Debt Law in New York

Re: Debt collector asset freeze

You can go to court and file a motion to vacate the judgment that was entered if you have the legal and factual basis to do so. You will have to allege that either you did not receive the summons and complaint (you were never served with legal papers) therefore the court did not have jurisdiction over you to enter judgment in the first place...OR you have to allege that even though you did receive the summons and complaint your failure to respond timely should be excused AND you have a meritorious defense to the action. If you had no knowledge of the law suit and learned about it when your account was tied up, go with the first one (lack of jurisdiction) and you may get the judgment thrown out. Once that happens, the bank account MUST be released. You have to move quickly or the funds will be removed before you have filed your motion papers. The motion papers, if prepared properly will STOP the creditor from taking any further action against you until the court has heard your request and ruled on it. Most judgments are vacated in this fashion. Get going!

Re: Debt collector asset freeze

In NY your account cannot be released without the consent of the judgment creditor or court order.

More importantly, in NY you may have important defenses against the placement of any restraints on your account and, even if a restraint is validly put on the account there may be limits to what can be seized.

For example, in NY they cannot restrain social security payments and/or pensions or other exempt assets and deposits.

Re: Debt collector asset freeze

Yes. This can be done several ways. arranging it with the collection agency is a reasonable way to proceed, but bear in mind that they will want the money in the bank account.