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Maryland-Judgement Entered-CapOne garnished bank acct. No Notice??


phideauxiii
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OK... I am going to be brief as possible, and instead of my usually super-duper narrative, I'm going to summarize the facts, as time is of the essence, here. My mother is ill, and I am acting as sort of an "ombudsman" in the context of this issue.

 

BACKGROUND:

My mother is quite driven, always paid all debts on time.. Previous divorce, 1997, lost it all. 
Rebuilt credit, bought house, et cetera. Outstanding credit score until loss of income. she's currently going after SSDI with a great case. 
Husband works 6-7 days a week to pay mortgage, etc., since mother's loss of income.

 

SITUATION

My mom had a Capital One credit card. There was a balance of roughly $7,500 when she lost income. Account was closed. She tried to work with them on a payment plan, CapOne sent it to attorney's offices.

Payments were being made monthly, $150, until she was unable to continue. Medical bills are horrendous.

 

Just yesterday, Sunday May 16, she attempted to spend $3.49 at CVS, her Check Card was declined. Her husband had just deposited $1,500 to pay a different debt in full, so she expected a positive balance. She never overdraws...

Upon calling the bank (Sandy Spring Bank) on Monday morning, they informed her that a "court attachment" had been placed on her account of approx. $7,500, this is the remainder, plus fees from CapOne

MY QUESTIONS:

-How is it that she received NO mail/service regarding the pending seizure of her personal checking account?

 

-Why was the entire judgement taken out of her account? She had $1,600 balance. They should have been able to garnish THAT,    but apparently, because she's now "overdrawn" by nearly $6,000, her debt to Capital One has become a debt to Sandy Spring Bank??

 

-The judgement against her was issued in December 2013 

-The timeline of the garnishment is below: Today's date is May 19, 2014
 

BELOW is the verbatim copy from the Maryland Judiciary Court Search. 

Type: WRIT OF GARNISHMENT OF PROPERTY Complaint No.:001 Date: 04/17/2014 Comment:I;04292014;GRP;001;WRIT OF GARNISHMENT OF PROPERTY ;ATP

Type: NOTICE SENT Complaint No.:001          Date: 04/29/2014                                   Comment:NOTICE OF WRIT OF GARNISHM. OF PROP. ISSUE (ATP)-U4
 

I am to understand that she may file a Motion in the Circuit Court for an EXEMPTION of up to $6,000 within thirty days of service. What I am supposing is the second date above being the date they mean for the 30-day-clock to begin ticking. 

Please, let me know how best to proceed. Everything I've read indicated that she should have received/been served SOME manner of written notice of the pending garnishment, or that such a motion by the plaintiff had been filed/granted. We got NOTHING to indicate this was in the works, as obviated by her recent deposits and surprise at having had her card declined which hasn't ever happened to MY knowledge...

Are we still within thirty days to file for exemption? We are on our way to the courthouse now, I am typing this on my laptop in the car, so please excuse any artifacts and errors.

THANK YOU for your time and attention, I look forward to any (serious) response, and I remain,

Quite Sincerely,

RPC

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Guest usctrojanalum

If judgment creditors were required to send a notice to judgment debtors that their accounts were about to be garnished, judgment creditors would never collect a nickel because judgment debtors would just empty their bank accounts prior to the bank account being attached.

 

The judgment balance being 7,500 seems quite high if she has made most of the payments you said.  

 

Also, the fact that the bank froze 7,500 does not mean she owes 7,500.  In some jurisdictions, banks are required by statute to freeze double the judgment amount on deposit to allow for interest to accrue.  This is state dependent though.

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She'd made arrangements with CapOne's lawyers to pay $150/month, it wasn't two months before she was hit with massive medical expenses. Her monthly pharmacy/doctor copays are huge. She stayed in touch with CapOne, and still has every intent of paying this debt. There was no need to attach her bank account., as this only makes it harder to pay anyone.

With no regular income and an SSDI application pending, she's right on the edge of losing it all.

My mom has always been the most responsible money-manager I've ever known. No matter what, her debts worry her day and night.

She hadn't a clue that CapOne motioned for and was granted an attachment on her account...

My bottom line is this:

She's certainly not a deadbeat, and is quite ill, and doesn't need this stress.

We filed a motion yesterday that she might opt to protect up to $6,000 cash/valuables as allowed by Maryland law. I'm praying it was filed in time, and correctly. My mom is super-responsible, type-A incarnate.

Thanks for the responses! If anyone here is familiar with Maryland law as it applies to bank account seizures and methods to reverse such orders, please let me know.

Thank you all!

RC

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She'd made arrangements with CapOne's lawyers to pay $150/month, it wasn't two months before she was hit with massive medical expenses. Her monthly pharmacy/doctor copays are huge. She stayed in touch with CapOne, and still has every intent of paying this debt. There was no need to attach her bank account., as this only makes it harder to pay anyone.

 

When she made those arrangements with the lawyers what she agreed to is known as a consent judgment. That means if she defaults on the payment agreement for any reason they do not have to sue her to collect they only file the judgment with the courts and then can garnish wages and bank accounts.

 

Unfortunately while her circumstances are heart breaking from her personal perspective as a large business they hear these reasons/excuses thousands of times a day.  If they listened to every one of them they could not stay in business.  It is cold but the reality of the situation.  While you do not see any reason to attach her account they do:  she stopped paying as agreed, again.  

 

The homestead exemption is likely her best option short term.  I used it in VA against Cap1 over a decade ago. They had garnished my wages and then had to give it all back because of the exemption. In the mean time she needs to keep that bank account empty if not close it.  Put the funds into cash and pay with money orders or put it on a pre-paid debit cards which are virtually impossible for a creditor to find and attach.

 

Long term if her debts are that high and causing that much stress she should have a conversation with a bankruptcy attorney to discuss all her options.  Most will do the initial consultation for free.

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To "Wins the Battle":

Yes, she was aware of the judgement. She had asked her husband for $1,500 only because PNC Bank (the one other creditor) had offered her a settlement amount which was a fraction of the original amount owed. That was the only substantial deposit made in a long while, and it was solely to settle with PNC.

Also, the $7,500 total that CapOne froze includes interest, legal fees, etc..

With the positive balance of $1,600, shouldn't the court's writ of garnishment only have frozen that amount? Her statement shows her as OVERDRAWN by nearly $6,000.

What this says to me is "the money she owed Capital One is now a debt to her CURRENT bank, instead of freezing the $1,600 positive balance, they "froze" the entire judgement amount, putting her in debt to an unrelated financial institution. How's that possible?

Thanks for any feedback!

RPC & MOM

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Also, the $7,500 total that CapOne froze includes interest, legal fees, etc..

 

This would be accurate because once the default happens on the consent judgment the full amount plus interest and fees comes due.

 

With the positive balance of $1,600, shouldn't the court's writ of garnishment only have frozen that amount? Her statement shows her as OVERDRAWN by nearly $6,000.

What this says to me is "the money she owed Capital One is now a debt to her CURRENT bank, instead of freezing the $1,600 positive balance, they "froze" the entire judgement amount, putting her in debt to an unrelated financial institution. How's that possible?

 

This may just be until the entire thing clears the banking process.  I find it hard to believe that the bank is going to front her 6k.

 

To know for certain you simply ask the bank what the process is.  There is no harm in doing so. 

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Guest usctrojanalum

Yes, the bank is not fronting your mom the 6k.  What happens when these holds get placed is that the bank puts into a reserve account the entire amount of the freeze, whether the funds are in the account or not.  Once the restraint is lifted, the bank account will return to a normal balance.

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I have no clue how to deal with what has already happened, but she needs to go all cash as much as possible. Have her open an account at a credit union for any direct deposits and take that money out the day it arrives. Then have her pay any other bills in cash or with money orders. 

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