Kate and her husband knew they had to settle a big debt to Capital One, but elected to wait until the bank came to them to pay up. The move ended up costing them, because Capital One got Wachovia to freeze their checking account with the assurance that it would release the funds once the couple paid up.

Except Kate and her husband did pay up in late November, but until yesterday, the checking account remained frozen. She explains:

I am really at the end of my rope, and I need help, big-time.

When my husband was younger, he was not the fiscally responsible adult he is today, and he got over his head with credit cards and private student loans. He and I have both worked very hard to become responsible with our money, but unfortunately, some mistakes have come back to haunt us.

Three years ago, Capital One won a judgment against my husband for a bad credit card debt for about $2,800. At the time, we didn’t have the money to pay, and so, being fairly stupid, we decided just to wait until they contacted us, and we’d work it out then. In the meantime, we both have worked really hard. We’ve advanced in our careers so that we’re finally living above poverty-level, and can actually afford to pay all of our bills AND eat, and we’ve managed to sock away some savings. We both have long commutes, and I work insane hours, but we do it so that we can square away the mistakes of our past and have a stable financial future.

So, of course, Capital One finally came calling.

This letter isn’t about them, though. They were owed money, and they had the legal right to get it through whatever means they could. The way they got it, was they got a Writ of Garnishment and got Wachovia to freeze our joint checking account until either a) we could pay off the amount with a certified check (which is now $4500 with all the legal fees, so THAT’S an expensive lesson) at which point they’d immediately send the paperwork to unfreeze the account, OR b) we could wait until enough of our paychecks direct-deposited that the lawyer retained on behalf of Capital One could recoup their money.

I had savings in a separate account (and an awesome mom who could float me until I could actually ACCESS the funds in my now-frozen checking account), so I opted for the “write a check, unfreeze the account, and move on with our lives” option. We did that, and the law firm representing Capital One immediately sent the paperwork to Wachovia letting them know that we had settled up, and our funds could be relinquished.

That was two weeks ago.

We understood it may take a few days; we know how legalities and bureaucracies work. But my husband has called Wachovia several times now, and keeps getting the same answer: “We don’t know where your paperwork is, we don’t know why your account is still frozen, and our legal department is very busy.”

I know we screwed up, and the start of this mess is our fault. But we have paid our debt, in full, to another entity that we were indebted to. We didn’t owe Wachovia anything, and yet they are the ones still holding our money hostage. Do you have any advice for us? Because at this point, I’m about ready to move into my local branch office with a sleeping bag until someone helps me.

And then Kate eventually regained access to her money:

We did finally resolve our issue with Wachovia, although I’m not sure HOW. We called their customer service line a dozen times, and the only response we got was that they hadn’t received the paperwork to release our account. This was completely erroneous, as not only had we sent it three separate times via fax, the lawyer that Wachovia retains to handle these types of incidents had faxed it to them AND overnighted it to them.

After nearly three weeks without access to our money (two of those weeks because Wachovia dragged their feet), we finally got our account unfrozen. I think it was possibly the three-pronged approach. In one day I emailed the CEO, went and parked myself at a branch and wouldn’t leave until they got someone from legal on the phone, and we told the lawyer that Wachovia retains that Wachovia was claiming he hadn’t sent paperwork that we knew he had sent, and we thought he should know they were scapegoating him. I’m not sure what finally got the ball rolling, but all I can say is that at 2pm that day, our account was still frozen, and legal was claiming they hadn’t received the paperwork, and that it would take at least another week to unfreeze the account once they HAD received the paperwork, and that at 7pm, the account was magically unfrozen.

I did receive a phone call from someone in the office of the CEO a full week after everything was resolved, in response to my email. However, they didn’t apologize for any of my trouble, just thanked me and hung up when I said my account was unfrozen. I have already opened a checking and savings account with another bank, and am in the process of switching everything over. Out of the probably twenty people we spoke to over 2 weeks, exactly two were helpful and/or remotely interested in our plight.

Has anyone been in a similar situation?

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