Just like any other regular payday, you head over to your local bank to take out some cash so you can pay your bills and treat yourself to some food and a bit of shopping.
After lining up for a bit at the ATM, you place your card in and come up with an idea of exactly how much you are going to need for the next few days before your next withdrawal. And as you have with every other time you’ve withdrawn money from your account, you put your card in, select “withdraw cash”, press “yes” on the receipt option, and put your pin in.
Once you’ve pressed enter on the last step, however, the unthinkable happens: you can’t withdraw cash from the ATM because it turns out that your account’s been frozen.
Well, it looks like you’re dealing with what they call a bank levy.
What Is a Bank Levy?
Understandably, you may be a bit flustered after realizing that you can’t take money out of your account, but it’s best to relax and consider all the details before you panic. To help you understand what’s going on, let’s first go over what a bank levy is so you know what to do moving forward and how you can avoid it.
Bank levies are a type of legal action leveraged by creditors such as banks and lenders to take funds directly from a bank account without getting the account holder’s permission. When this happens, the account is essentially frozen and rendered inaccessible to the owner.
Generally, these types of actions are used by creditors as a last resort when a borrower fails to stick to their repayment obligations or when other collection methods have failed. Over the years, however, bank levies have become even more common for Birmingham residents as courts are now more likely to expedite filings from lenders.
How Does It Work?
To levy an account, a creditor must go to court and file a legal document that states why they want to levy an account. They must provide supporting evidence behind the reason for doing so. During the filing, a lending party must be able to prove or demonstrate that it attempted to collect the outstanding debt before a court declares it eligible to enforce a bank levy.
After a judgment against an account holder is awarded or given, a legal order—also known as a “Writ of Execution”—is sent to their bank.
Once a bank receives the notice from a lender and the court they filed at, they are obligated to inform an account holder of their status and what may happen if dues are not paid. If you find yourself in such a situation, it’s important to note that you will still have time to fix things before you are restricted from accessing funds in your account.
What Should You Do If You Get a Bank Levy?
If you’ve never experienced a bank levy before, you should be aware that there’s a set process that takes place. Before your account is frozen, a creditor—or a collection agency hired by them—will contact you by phone or mail before a Writ of Execution is granted to them. Should you be lucky enough to receive a call, e-mail, or mailed letter, then you’ll need to act as soon as possible before you are completely held off from accessing your funds.
If you learned about your frozen account out of the blue, it’s typically recommended that you settle your dues or negotiate with your creditor for partial payment. And if you have a lender that’s refusing to work with you in a tight situation, it’s best to enlist the services of an expert like Axiom Tax Resolution Group!
Finding yourself face-to-face with a frozen account, a bank levy, and an inability to access your funds can be a tough situation if you don’t act fast. Once you follow the right steps and implement the necessary approach for a settlement of dues, you’ll be able to access your funds again in no time and avoid issues in the long run.
If you end up with a bank levy being placed on your account or you need assistance for tax relief solutions or IRS debt forgiveness, contact Axiom Tax Resolution Group for quick and effective assistance to resolve your issue ASAP!