Credit card company Levied my bank accounts. Can they do that? Do I have any recourse?

Asked over 2 years ago - Carlsbad, CA

Can a credit card company levy my bank accounts even though they charged-off the account a long time ago?

I owed a debt to a credit card company, and only recently decided to levy my bank accounts, however my credit report shows that they charged-off and closed the account 2 years ago. My wife and I have been avoiding bankruptcy until now.

Where should we go from here?

Additional information

How do I find out if there is a summons?
Do I contact the attorney that filed the judgment?

Attorney answers (5)

  1. Frank Wei-Hong Chen

    Contributor Level 20

    2

    Lawyers agree

    1

    Best Answer
    chosen by asker

    Answered . A charge-off is the declaration by a creditor (usually a credit card account) that an amount of debt is unlikely to be collected. This is an internal accounting designation designed to give the creditor a tax exemption on the debt. Often, these charged-off "bad debts" are then sold to collection agencies.

    A charge-off does not free you, the debtor, of having to pay the debt. The debt remains legally valid, and the creditor still has the right to collect the full amount so long as it is within the statute of limitations period.

    If you are contemplating filing for bankruptcy, consult with a bankruptcy attorney before making any payments.

    Otherwise, it would appear that there was a lawsuit filed against you but you were never served with the summons and complaint. Your recourse would be to have an attorney file a motion to set aside default and vacate default judgment pursuant to Code of Civil Procedure section 473.5.

    However, if you agree you owe the debt but just can't afford to pay it, and want to prevent or limit wage garnishments and bank levies, you may wish to consider filing a Claim of Exemption with the Sheriff.

    See:

    http://www.avvo.com/legal-guides/ugc/how-to-fil...

    Frank W. Chen is licensed to practice law in the State of California. The information presented here is general in... more
  2. Eric D Ridley

    Pro

    Contributor Level 14

    3

    Lawyers agree

    1

    Answered . They can, if they served you with a summons & complaint, you didn't respond, and the company obtained a default judgment. Could you provide more facts to help us? Were you served? Was there a suit? If you were not served, an attorney may be able to file a motion to set aside the default judgment.

    To discuss this answer with me in more detail, please call (805) 244-5291 or email me at ridley.eric@gmail.com.... more
  3. Douglas Gist Farquhar

    Contributor Level 11

    1

    Lawyer agrees

    1

    Answered . A charge-off just means that the debt was sold to another creditor/collector who will come after you now for payment. The charge-off did not make your debt disappear, you now owe the new creditor/collector. They apparently have a judgment because they are levying your bank account.

    It may be time to consider filing that bankruptcy to get rid of this debt. I would be glad to give you a free consultation. Call me Monday at 619-702-5015 or e-mail me at farquharesq@yahoo.com or visit my website at www.farquharlaw.com.

  4. Kathryn Ursula Tokarska

    Contributor Level 16

    1

    Lawyer agrees

    Answered . You can see if there has been a case filed: http://courtindex.sdcourt.ca.gov/CISPublic/enter

    As other counsel pointed out, charge off doesn't get rid of the borrower's obligation to repay the debt. The charge-off simply means the creditor realized you won't pay in a timely fashion.

  5. Walter C Oney Jr

    Contributor Level 17

    2

    Lawyers agree

    1

    Answered . You should go directly to a bankruptcy attorney. The charge-off doesn't change anything for you, only for the creditor for tax write-offs. A bankruptcy filing would halt the levy and unfreeze your accounts, and it might even allow you to recover anything taken within the past 90 days.

Can't find what you're looking for? Ask a Lawyer

Get free answers from experienced attorneys.

 

Ask now

28,270 answers this week

2,919 attorneys answering

Ask a Lawyer

Get answers from top-rated lawyers.

  • It's FREE
  • It's easy
  • It's anonymous

28,270 answers this week

2,919 attorneys answering