Bank Account Garnishments in Texas
In Texas, when a creditor obtains a judgment against you they are allowed to garnish (or freeze) any bank accounts you might have to satisfy the judgment. It can obviously have a drastic effect on your ability to conduct your day-to-day finances, like paying your mortgage or other essential bills. It can come out of nowhere, where you will likely wake up one day years after the judgment has been entered to find your bank accounts frozen.
Unfortunately, you find out about the garnishment when you wake up one morning and all of your accounts are inaccessible.
Travis Bryan Managing Partner
A garnishment proceeding is technically a new lawsuit filed by the judgment creditor against your bank where you have an account. Your bank is required to file an Answer to the garnishment as they are the Defendant. Fortunately for them, and unfortunately for you, the bank will charge you for filing this Answer as part of their legal fees. Your bank however will not put up a defense to the garnishment and simply freeze your account for two times the amount owed.
Once the bank receives (is served with) the garnishment, your funds will be frozen. The funds remain your money for weeks, until the Judge signs an order releasing the funds to the judgment creditor. This will give you some leverage to try and settle the judgment.
Fortunately, there are some exemptions that protect bank accounts from garnishment. Social security funds in your bank account are exempt from garnishment. It is important to note that only 2.5 times your monthly social security disbursement are protected from garnishment…this means that if you have excess social security funds accumulated in your bank account they may not be protected.
You may have grounds to dissolve (or fight) the garnishment proceeding as well. If you can prove that you weren’t served with the garnishment, or that the garnishment paperwork is defective…you may be able to have the garnishment dissolved. But if there are no grounds for dissolving the garnishment, your best options are to either attempt to settle with the judgment creditor by offering some sort of judgment payoff...or filing for Chapter 7 bankruptcy.
The information contained in this web page is for general information and educational purposes and is not legal advice. Reading these posts does not create an attorney / client relationship with the law firm of Johnson & Bryan.