Prevent Bank Levies - File For Bankruptcy

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How to Prevent Bank Levies

In case you have incurred huge debts and are in no financial condition to pay them off, the best resource available to you is to file for bankruptcy. To do the same you can either use one of the bankruptcy lawyers to file bankruptcy for you or you can do it yourself. However, as Sacramento based law firm Recovery Law Group explains, many times debtors filing for bankruptcy without any help from lawyers, end up into financial troubles like post-bankruptcy filing bank levies.

The most common mistake done by pro se bankruptcy filers is forgetting to notify all concerned parties involved in debt collection about bankruptcy filing and discharge. Many times, most debtors have a number of active lawsuits filed against them, some of which may have ended in the default judgment allowing creditors the power to seize wages and bank accounts of debtor through bank levies. It so happens that many times the creditor and the debt collection agencies are different people. In case, the debtor remembers to notify the original creditor of the bankruptcy filing, it is not necessary that the debt collection agency and the lawyers coordinating the lawsuit are also aware of the proceedings. This may lead them to act on the judgment and levy the bank accounts, crippling the debtor financially.

When Bankruptcy proceedings are filed by bankruptcy attorneys on behalf of their client, they ensure the following:

• They will obtain the name of the lawyer or law firm handling the lawsuit against the debtor and also enquire in which court the lawsuit is being held.
• They will notify all concerned parties involved in the lawsuit, in writing, to stop the bank levy.
• In case a bank levy is in the process, the bankruptcy lawyer will find out the Sheriff department responsible for serving the levy and notify them of the debtor’s bankruptcy filing.
In case any creditor has won a lawsuit and is days away from seizing your assets when you file for bankruptcy, any and all collection processes must be aborted after you file for bankruptcy. However, this is possible only if they are aware of the bankruptcy filing. Some creditors, despite an automatic stay in bankruptcy, try to seize bank accounts, hoping that any debtor who is not working with an attorney will not be aware of the way to get past this kind of behavior.


2019-05-06T10:01:16+00:00