Can a bank legally keep me from withdrawing the money in my savings because of money that I owe for a repossession?
Question Details: About 6 years ago I got a loan to buy a 5 wheeler that my wife and I lived in for a while. Then 3 years ago we moved and my parent's friend took it and was making the payments on. However, about 6 months ago he stopped paying and it was repossessed. Now because of the money owed, the bank will not let me take out the money that is still in my savings account. Is that something they can legally do?
While the parent's friend was making the payment on the vehicle, the loan was still in your name, correct? If so, then you are legally responsible for it.
Whether the bank can prevent you from withdrawing money while in default on the loan depends on the loan agreement and the other agreements between you and the bank (for example, any agreements you signed in opening the account). If one or more of those agreements gives the bank the authority to do this, then it is legal--otherwise, they would not seem to be able to do this. The first thing, then, is to review all such agreements carefully; you can also ask the bank to explain their grounds for not letting you withdraw your own money, and to point to any terms in any agreemens given them this authority.