Understanding Frozen Bank Accounts: Causes, Prevention & Resolution

There are a few things more frustrating than having a debit card transaction declined or not being able to get any cash from an ATM when you know that your bank balance is sufficient. In some cases, these issues are caused by technical glitches, such as bank networks being temporarily down. However, there are other circumstances that could cause a bank to freeze your account, making it impossible for you to complete transactions.

Frozen Bank Accounts

A frozen bank account means that you will not be able to access the funds in your account. Your bank may also reject any transactions that are in process. For example, checks you've written may bounce, automatic bill payments and debit card transactions may be declined and, according to HelpWithMyBank.gov, your bank may charge you fees for these transactions, depleting your account.

Tech Glitch vs. Frozen Account

If you suspect that your account has been frozen, but are not sure, the best approach is to contact your bank immediately to ask about the problem. You might try logging in to your account through your bank's website or mobile app. Depending on what has occurred, you may encounter a message explaining that there is a problem with your account (and that you should call the bank for more information) or that there is a bank-wide outage and that you'll simply have to be patient.

If you cannot log into your account, or you haven't found an explanation, it's time to call your bank. The customer service representative that you speak to should be able to provide you with information about what has happened.

Unfreezing a Bank Account

The process for unfreezing your bank account depends on the reason for the original freeze. In some cases, such as a security freeze, you should be able to resolve the issue on your own. However, there are some instances in which you may need to work with an attorney to regain access to your funds.

Here are some common scenarios:

Security issues: You are likely to discover the problem when your debit card is frozen and is rejected for a purchase. The reason for this is that your bank's fraud department has detected unusual activity and, as a precaution, freezes the account. Typically, all you'll need to do is call the bank and review some information. For example, you may be asked to describe some recent transactions before your account is restored.

Suspected fraud: If your bank suspects that you are using your account for fraudulent purposes, it may freeze the account while it conducts an investigation. This can be a more complicated matter to resolve. ProPublica reports that account holders who have had their accounts frozen by banks have had to supply extensive documentation of their transactions before their funds have been released.

Levy or garnishment: If your account has been levied or garnished, your bank can't unfreeze the account on its own. You might be able to contact the creditor and work out a settlement or payment plan in exchange for lifting the garnishment. If some of the funds in your account are from Social Security or other government benefits, your bank is required to protect those funds from garnishment and make them available to you, according to HelpWithMyBank.gov.

Joint account disputes: If you hold your account jointly with another person and you are involved in a dispute, that person may seek to freeze the account to prevent you from removing funds. This sort of thing often happens as a result of an impending divorce or a relationship breakup. According to Forbes, you may be able to ask the bank to remove the freeze so that you can withdraw funds. However, there is the risk that the other party could re-freeze the account. At this point, the bank may close or place restrictions on the account until you and the other party settle your differences.