Not true, Jimmy. People try that all the time, and end up with money being seized anyway. There may be a portion that is deemed to belong to the other person, but the funds are definitely garnisheeable.

Only way to "protect" those funds is to have the account entirely in the other person's name and simply operate off a bank card.

They can't touch joint bank accounts unless both people owe the debt.

How does bank account garnishee work with joint accounts? I've heard of people protecting their bank accounts by making them joint with their spouse (this only works if the debt is in ONE person's name only though).

One thing learned a while back - if you're self employed, don't always assume you're safe from 'wage' garnisheement. I once worked for General Construction Contractor and one of the companies contracting from us was up to their a$$ in debts. Somehow, one of their large creditors found out that they had a large work contract with us and petitioned the court to garnishee money from the progress draw checks we issued to them. I'm sure this was only able to be done because we had a 30 page CCDC contract with the subcontractor, so proof of company income was stated directly on paper.

I do remember the owner of said subcontracting company coming to our office and threatening our controller (whose hands were tied...he was ordered by the court, remember). I'm not sure if the COMPANY owed the debts or if the company was solely owned by the guy who owed personal debts...

Not sure how the in's and out's of the this works, but I remember thinking "wow, I didn't know that could be done". There may be different rules if you are say, a sole proprietor, a partnership, a limited company or incorporated. I'm sure it's quite complex, but it would be interesting to see if anyone knows anything about this!

I'm not off from holidays yet, however, I always love a post like this.

The collection agency has to prove that it owns the debt, or that some how you are contracted with them.. If you don't have a contract with the collection agency, how would they expect to sue you in court.

As Raymond said, fight it by saying that you don't owe them the money. They have to show miles of proof that you do owe the collection agency money.

It might take a 3 to 5 months depending on where you live for someone to get a default judgement. A good bit longer if you decide to fight it because of the mandatory pretrial conference. And you can always ask for adjournments. Why would you not fight it - you'd be crazy not to. If they issue a statement of claim against you, make sure you file a defence, even if it's only to say, "I don't owe the money." Costs you $45 or so but will save you a lot more at the pretrial settlement conference.

If you want to read some nonsense about crazy mortgage finance schemes to cover debt, see my posts at the beginning of thread 457 on Deanna Natale and Total Credit Recovery.

Hint: Don't do it.

That was another thing -- this agent kept pushing he could "help us" because he knew some people who could help us refinance, get a line of credit, etc. This made me very suspicious. Also, he first said it would cost about $1800 in fees once they send it to court and then said when all was said and done the debt would be $11,000 to $12,000 (on an original of $7,000).

My question do you know how long it takes them to file in Small Claims? He said they would get an automatic default judgement. Do these usually take time so I have a couple of months to see if I can raise the funds and pay the creditor?

In order to enforce judgements, assets, personal property and real property can be seized. Personal property like furniture is almost impossible to collect on so, generally, collection agencies go after the easiest pickings, which is your bank account, a vehicle (over 5000 dollars) or your wages. Also note that they will almost surely have done searches under your name in your province's personal property security registry. For large debts, a writ of seizure against real estate property can be filed (but rarely is) for small claims court amounts (at least in Ontario) because of the large deposits and time required.

And so, if you have a bank account and you've issued cheques or are on direct pay deposit, now would be a good time to change it. Keep your old bank account but leave only a few bucks in it and get your pay deposited at a new bank (not just a different branch of the same bank). However, be aware that the new bank may ask you where you work and then report that to the credit bureaus. The new bank will almost surely do constant credit searches on you (soft and sometimes hard) - whether or not you authorize it in your application - because they are under a lot of pressure to sell you more credit instruments. So just tell the new bank you are self employed. Wage garnishees are usually limited to a max of 20% or less and so to seize your whole payroll deposit would be illegal. Still, hard to tell what they could if they tried to seize it AFTER it had become a deposit. Then it would be an asset. However, a collection agency knows they would only be able to do this once before the person changed his bank account. So, the more likely thing for them to do is to garnish your wages because then, you'd have to change jobs to escape. Do they or the credit bureau know where you work? If you are self employed, then don't worry.

Of course, all these writs of seizure can only be obtained once a credior has taken you to court and gotten a judgement against you.

I don't know the details of your situation, but I would tend to let them to take me to court first because, no matter where you live, a pretrial settlement conference will be mandatory with terms that will likely be a lot easier to live with than what they are demanding. The worst thing you can usually do is go the "Deanna Natale route" and take out a second mortgage through a firm like Deanna Natale and George Krieser's Five Star Mortgage outfit. That might put you in a financial death spiral. That pressure to sign those clowns at ARO are putting you under, (with likely kickbacks to the collection agents), is similar to what Total Credit Recovery was doing.

Still, because you own a house, you have to be careful; just try and arrange some reduced settlement terms that you can live with - and if that fails let them take you to court as you've got nothing to lose and lots to gain. Even if it goes to actual trial, the judge would likely issue you payment options you could live with; however, if you own real property, the creditor, while they couldn't take any other action against your wages, bank accounts or vehicles while you kept the court ordered arrangements, (depending on where you live), might still be able to get a writ of seizure against your house. That would at least encumber any future sale. Anyhow, I would let it go as far as a pretrial conference.
Ray

The way wages are garnished (if it has been ruled by the court), is through your employer, and NOT through the bank.
If a collection agent told you they will empty your bank account right after you get paid, it sounds like a scare tactic.
Am I wrong Raymond?

PB.

I should note he was saying that they could go into our bank accounts every time we get paid and empty them before we could take any money out.

Safety deposit box.
Awsome little things, and NOBODY can touch them except you.
Tell ARO to go F themselves.

PB.