Legal Question in Credit and Debt Law in Pennsylvania

Can a collector freeze my bank account? I'm a co-signer on a student loan.

Asked on 5/11/12, 12:49 pm

2 Answers from Attorneys

Andrew Solomon Law Office of Andrew A. Solomon

Before a debt collector can freeze or attach your bank account, they must first obtain a judgment against you, Once a judgment has been obtained the debt collector can execute against your bank account with a writ of execution. You should receive notice before any of these things happen. It also makes a difference if this is Federal loan, or a loan from a bank. Different rules may apply. You should contact the collector and try to work things out with a payment plan or forbearance if you qualify. Also, why isn't the student/parent not paying off the loan? He/She may qualify for forbearance or reduction depending on the type of loan it is.

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Answered on 5/11/12, 2:17 pm

I agree with Attorney Solomon. Howeever, some creditors do not give notice to you that a judgment has been entered. They give a 10-day notice of their intent to get a judgment but they do not always tell you that a judgment has been entered.

Creditors can do nothing until the judgment has been in place for 30 days. Any amounts less than $300 are safe. I would look to getting an online bank account or pre-paid debit card and not habve any bank accounts for any creditors to freeze.

However, you don't indicate a lot of details about the loan. Is the loan private or federal? Is the loan in default? What is the primary borrower doing to address the situation? Lenders have a lot more options. like wage garnishment, than do other kinds of creditors.

Co-signing is always a bad deal. Whomever you co-signed for needs to step up to the plate and pay this. Bankruptcy is not an option as most student loan debts are not dischargeable in bankruptcy. And even if it was, if only the primary borrorwer filed, you would still be on the hook for the loan.

If you end up paying, then you need to make sure that you get a written agreement in place before you pay. I hope that the primary borrower does the right thing here.

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Answered on 5/13/12, 8:22 pm

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