What To Do If A Collection Agency Freezes Your Account

Telling Tips is a series of articles from local experts to help you save money, make better decisions and plan for a better future.

A client came to us recently in our Brooklyn office.  She was being sued by Mel S. Harris & Associates, a collection law firm in New York. Her bank account (actually her husband’s bank account) was frozen. The story is all too familiar.

She never received any summons and complaint. She never received any Notice of Motion for Default Judgment (which is an action a creditor takes in Court when you don’t respond to a summons and complaint in New York). She received no court papers at all. She wasn’t even aware that any debt existed under her name. All she knew was that she could no longer access her husband’s account, which had thousands of dollars in it.

We were able to unfreeze the account and have the case dismissed in less than 48 hours. That doesn’t guarantee that the same result will happen in each and every case. In fact, its an aberration in some respects. The lawyers there, after we showed them proof that our client did not live at the address where she was allegedly served, were quite courteous and did the right thing.  However, I need to stress that if your account is frozen in New York by a credit collector, the last thing you should do is call them immediately and try and settle the debt.

Unfortunately, that’s what I find many clients do. Literally, in my opinion, it’s the worst thing you can do.  There are just so many defenses available to you in these types of cases.  Many times you’re not served properly.  Many times the credit collection law firms may not have the necessary proof to collect on these debts, but are still going after you anyway.  There are far too many cases that I see, where, if someone saw a lawyer beforehand, they could actually save thousands of dollars.

This isn’t one of those “Oh, come in and well aggressively fight for your rights” sales speeches. This is real. I see this everyday. People are paying extraordinary sums to companies that may not even own the debt.  They’re paying money to people who didn’t do what is required by law.  It is, in many cases, simply a waste of the money you have. The least you can do is investigate whether or not you legitimately owe this money.

You can also, on your own, go to the Kings County Civil Court and see if you can’t file something called an Order to Show Cause, which, in its most basic element, allows you to ask the judge to hear your case again, if you don’t believe you were served properly with any papers.  Food for thought.

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Daniel Gershburg Esq., is a real estate and bankruptcy attorney with offices in Sheepshead Bay and Manhattan. The practice was specifically set up to change the way people view attorneys, by incorporating radical ideas like calling people back quickly, returning emails, giving clients ’round the clock access to their cases and charging low fees. For more information please visit Brooklyn Real Estate Attorney Daniel Gershburg‘s website.

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