If my daughter has outstanding student loans and her paycheck gets direct deposited into my wife’s bank account, can a collection agency freeze my wife’s account?

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If my daughter has outstanding student loans and her paycheck gets direct deposited into my wife’s bank account, can a collection agency freeze my wife’s account?

Asked on October 16, 2012 under Bankruptcy Law, Texas

Answers:

MD, Member, California Bar / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

Absolutely the collection agency can certainly freeze your wife's account if it discovers that the paychecks are traced into that account. Then it will be up to a judge to decide whether this is sufficient to continue a freeze of the asset or reverse it because your daughter's name is not on the account.  Either way, it is certainly not a good idea to do so if your daughter is facing collections on her student loan account. The safer method is to attempt to negotiate with the loan company or collection agency.


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