Hello I am a licensed attorney here to help you with your question, please review my response and do not hesitate to ask for clarification.
Once you file a bankruptcy all garnishments and collections efforts have to stop and any monet taken must be returned in most cases.
Customer: So do I notify the bank (the one holding the money as a trustee) that I have filed and to return it to my account ?
you should contact your bank, and the creditor as well, they may ask for a copy of the petition filed and the case number XXXXX well.
Customer: The bank that is suing me and that got the ex parte attachment put thru in the first place is a listed creditor and will be notified of the filing shortly, but I wasn't necessarily looking to notify them sooner rather then later. Could I just send a copy of the petition to my bank and request a release ?
Customer: Also, if and when it is released, is it my money to use/withdraw, etc., or am I restricted by the filing in how I use it ?
Yes start with the bank, notify them of the case number, but the law allows all funds taken 90 days prior to be returned, so you may want to advise the creditor, he will be reciving notice of the filing anyway within a few days.
Once the money is given back it is part of the bankruptcy estate and unless it is exempted it would go into paying your creditors.
Customer: ok great - I appreciate the help. Do I need to cite a certain MGL or citation or will my bank know that it should be released ?
Customer: btw - what would exempt it ?
The bank would know, in fact they willl know that a violation of the Federal automatic stay cn result in fines from the federal courts.
The filing of a bankruptcy case, under any chapter of the Bankruptcy Code, triggers an injunction against the continuance of any action by any creditor against the debtor or the debtor's property. 11 U.S.C. 362.
The automatic stay prohibits
- Beginning or continuing law suits
- Collection calls
- Foreclosure sales
- Garnishment or levies
The automatic stay remains in effect until
Customer: ok - thanks this is great and extremely thorough - and any thoughts on what would make it exempt ? Would be nice to get some of it back to clean up some stuff
every state has their own exemptions,
If you are in Mass
Customer: i am
Go to the above link it has the 2011 new bankruptcy exemptions.
Customer: ok again you've been a great help and unless you have any more info that you think might help I'll accept
If you will be recieving a significant amount such as $10,000 or more, I would dismiss the bankruptcy and use the money for yourself, and then consider a bankruptcy later, the stay will remain for a few months.
If you have any further questions please do not hesitate to ask.
Customer: its $ 8100 and the filing was done to stop a civil suit that was about to go to trial that I couldn't afford to defend or to lose so I could get it released, then dismiss the filing, take the money, and then re-file later ?
Customer: and this was not the same suit that is associated with the ex parte attachment
yes, but wait till the amount is given back to you, and do not attend the chapter 7 341 hearing in most cases the trustee would dismiss the case in three months or longer.
The lawsuits would not be able to start until after the three month window, when the case is actually dismissed.
Customer: I am definitely going to give that some serious thought