Right Of Offset

Offset:

Whenever you want to exercise your legal right of offset, you should always seek legal advice.

Prior to exercising the right of offset, two main components must exist. The name and tax ID number must match and the debt must be matured. You can’t offset a deposit account for a single payment on the note.

Next, you will need to ascertain if any part of the deposit account(s) funds was a result of public funds, including relief funds in situations of a disaster.

The following is a check list of what you should send to counsel prior to exercising your right of offset. Copy and paste in an e-mail, answer the questions, and e-mail it to your attorney.

Is the debt matured by either through normal maturity or acceleration because of a default? (Yes or No)

Does the name and TIN match on the deposit account and the obligation?

Did you confirm by reviewing the signature card and the loan documentation?

Are there multiple account holders and tax identification numbers on the deposit account?

Does any part of the deposit account contain public fund, if so, explain and how much?

What type of loan is it? (Consumer or Business)

Was any default notices sent to borrower(s) and guarantor(s)?

Is the debt collateralized with real estate?

Prior to sending the e-mail to counsel, verify all information. Sometimes, TIN’s may match on the system, but not on the signature card or other related documents. Therefore, verification of information is important.