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Garnishing Your Bank Account

On Behalf of | Jan 28, 2011 | Consumer Protection

My bank account was frozen and I was never given notice.  This is a frequent complaint that we hear from consumers.  Learn more about this and other frequent inquiries by reading below.

What is a bank garnishment?  If there is a judgment against you, to satisfy the judgment, the creditor can garnish your wages, garnish your bank account or place a lien on personal property.  If the garnishment is for collecting taxes or a federally funded student loan, a judgment or court order is not necessary.

Is the debt collector or creditor required to give you notice prior to garnishing your bank account?  No, there is no rule requiring the prior notice before garnishing your bank account.   However, you must have received notice of the lawsuit against you by service of a summons.  Once you receive the summons and lawsuit, there is no continuing obligation to warn you of each ensuing step.

But I never knew that there was a lawsuit against me.  How can this happen?  What can I do?  You have the right to know that a lawsuit is pending against you, and that a judgment (and ultimately a garnishment) can be placed against you.   Whether you were given that knowledge will be made known by a review of the court file.

The court file is a public record, meaning you are entitled at any time to see its contents.  If you are interested in protecting yourself from undue harm from this garnishment, you should go to the courthouse where this case is pending and obtain the court file.  When you obtain the court file, you should go through it and make copies of the “Complaint” which is the lawsuit filed against you, the “Summons” and any document indicating it is a “Proof of Service” or “Affidavit of Service.”  This is the document upon which they claim they notified you of the lawsuit that was filed and provided you the opportunity to go to court to defend yourself.

If after reviewing those documents, it appears that the service was faulty (i.e. not served at your place of residence at the time) then please contact us for assistance.  We may be able to help get the judgment vacated and provide you the opportunity to defend yourself and resolve this debt in a more reasonable manner than having your wages taken from you.

What is a default judgment?  If a lawsuit is filed against you and you do not properly respond, you may wind up having a judgment against you.  That is called a default judgment.

This is a judgment against my spouse or significant other, not me.   My name is nowhere on the judgment, can they still take my money?  No, they can not take your money, but  you need to prove to the court and creditor or debt collector that these funds are yours.   You will need to provide documentation such as paystub receipts and bank statements.  It is in your hands to prove that these funds should not be subjected to the garnishment.

What type of funds are exempt from garnishment?  This varies from state to state.  Please click here for your state’s wage garnishment rules.  However, no matter where you live social security payments and unemployment benefits are exempt from garnishment.

Some helpful tips to prevent garnishment surprises:
(1)   Never ignore a summons or lawsuit.  Respond timely.
(2)   Keep a paper trail.  All communication should be verified in writing, like a settlement, and sent certified mail.
(3)   If you have a spouse that has credit problems, keep your bank account and other assets separate.
(4)   Contact SmithMarco, P.C.,  if you still have questions.  We provide free, confidential case reviews.