Can a Wage Garnishment Garnish Your Bank Account?
After a lawsuit, a creditor that requests permission from the court to garnish your wages can legally seize a portion of your paychecks. Although the same creditor might also request permission to garnish your bank account, bank account garnishment and wage garnishment occur independently of one another.
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Facts
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When a creditor requests a garnishment order, it must specify the company or individual the sheriff must serve the garnishment to. In the case of a wage garnishment, this company or individual is your employer. Your employer must then calculate the legal amount it can withhold from you and use the withholdings to pay your creditor. Because of the specificity of the original garnishment order, wage garnishment has no impact on your bank account.
Considerations
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A creditor can simultaneously garnish your bank accounts and wages. Provided the creditor knows which bank you use, it can request a separate garnishment order from the court and direct the order to your bank. Creditors are most likely to seek a bank account garnishment if the majority of your wages are exempt from garnishment or you are currently unemployed.
Time Frame
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Creditors can garnish both bank accounts and wages until your debt is paid in full or the court judgment that grants the creditor garnishment rights expires. State laws vary regarding the length of time a given court judgment is valid, but many states give creditors the option to repeatedly renew court judgments. Should this occur, your creditor might have 20 years or more to garnish both your wages and your bank balances.
Creditors' Preference
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Although the U.S. Department of Labor places strict federal restrictions on the amount of money a creditor can garnish from your wages each work week, fewer restrictions apply to bank account garnishments. This makes bank garnishments a more attractive debt recovery option for many creditors, because they can collect a larger sum at once rather than a smaller sum over a longer period of time.
Solutions
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After a creditor wins a judgment against you, negotiating a voluntary payment plan with the creditor can prevent you from being subject to a garnishment order. Although a creditor with the right to garnish does not have to accept a payment plan, many will do so in order to avoid tracking down your employer and your bank. If you do not owe the debt you are being garnished for or were never notified that the creditor had filed a lawsuit against you, you can appeal to the court to have the judgment overturned and the garnishment order terminated.
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