Freeze of Bank Account - Texas

[ssdsco]

Get all your money out of the bank. Stop all automatic deposits and withdrawls first of course. Then get your paychecks and other compensation in cash and use money orders to pay your bills. The 25cent per money order charge at Walmart sure beats losing every penny you have in your bank account!

That would be my advice until the judgement is resolved.

[GoingDown]

Usually, they issue an informational subponea to all banks in an area asking if they have an account with your name. They'll nail everything in it up to the amount of the judgment.
All you can do is try and enter into some sort of formal repayment agreement with the judgment creditor if, you don't plan o file bk.

No, that's not all you can do...

You could also get ALL of your money out of that checking account / savings account and start using cash and money orders to pay for everything, and get paper checks and cash them instead of depositing them into a checking account.

That way they can't get your money.

If you live in Texas and you don't own real estate, then you can be VERY JUDGMENT PROOF. Because they can't garnish wages, and if you don't use a checking account, there is almost nothing they can do to get paid.

You need to take advantage of this situation.

I wish I lived in Texas, sometimes. It's a debtor-friendly state.

[jp2861]

No, that's not all you can do...

You could also get ALL of your money out of that checking account / savings account and start using cash and money orders to pay for everything, and get paper checks and cash them instead of depositing them into a checking account.

That way they can't get your money.

If you live in Texas and you don't own real estate, then you can be VERY JUDGMENT PROOF. Because they can't garnish wages, and if you don't use a checking account, there is almost nothing they can do to get paid.

You need to take advantage of this situation.

I wish I lived in Texas, sometimes. It's a debtor-friendly state.

If the court order comes from a state other than Texas, then your wages can still be garnished in Texas.

[howdidithappen]

Treehugger - Texas Wage Garnishment deposited in bank - what is the percentage?

[treehugger1]

I'm not sure of a percentage. In Oregon, 75% with up to $7500 of exempt income is still exempt when deposited in a bank account. I'm sure that there are many folks who don't bother to list monies in abank account when they fill out an exemption form. As for Texas, I don't know the rules.

[GoingDown]

If the court order comes from a state other than Texas, then your wages can still be garnished in Texas.

I don't think so.

The judgment would still have to be domesticated in Texas before it would be any good, and then it is subject to the laws (and exemptions) in Texas.

In Texas, wages are exempt from garnishment.

[GoingDown]

I'm not sure of a percentage. In Oregon, 75% with up to $7500 of exempt income is still exempt when deposited in a bank account. I'm sure that there are many folks who don't bother to list monies in abank account when they fill out an exemption form. As for Texas, I don't know the rules.

If they really want to keep their money safe from creditors, they need to stop using a checking account or savings account. Even if the money is technically exempt in a checking account, the creditor will seize it and then it is up to the debtor to prove it was exempt in court, which costs legal fees, court costs, time, not to mention the fees a bank will charge the debtor for dealing with the seizing of their funds.

So, if you have a judgment against you, you had better keep your money out of a bank. Use cash and money orders to pay for everything until you file bankruptcy.

[jp2861]

I don't think so.

The judgment would still have to be domesticated in Texas before it would be any good, and then it is subject to the laws (and exemptions) in Texas.

In Texas, wages are exempt from garnishment.

They use Article IV, Section 1 of the Constitution of the United States of America. It says something to the effect that full faith and credit shall be given in each state to the public acts, records, and judicial proceedings of every other state.

There are cases out there where the garnishments have happened.

[GoingDown]

They use Article IV, Section 1 of the Constitution of the United States of America. It says something to the effect that full faith and credit shall be given in each state to the public acts, records, and judicial proceedings of every other state.

There are cases out there where the garnishments have happened.

Well, Bud Hibbs lives in Texas, and according to him, they can't garnish wages in Texas for consumer debt judgments.

https://www.budhibbs.com

[jp2861]

Well, Bud Hibbs lives in Texas, and according to him, they can't garnish wages in Texas for consumer debt judgments.

www.budhibbs.com

I'm familiar with his site. However, a google search will show cases in which garnishments have happened. Caselaw evolves on a daily basis. Just because a website says one thing doesn't mean that website is always going to current.

This is starting to wander off course so I'll just leave it at that.

[Granny]

I found this interesting

https://www.ilcba.org

A TEXAS GARNISHMENT

"Here is a situation of interest which was recently presented to Judge Betar. Defendant had been sued here in Illinois and a Judgment had been entered against him for the non-payment of a medical bill. At the time the suit had been filed, Defendant was employed by a national employer at one of its facilities in Illinois. Subsequent to the Judgment, Defendant was transferred to Texas. The employer continued to issue him paychecks from a payroll office in Illinois.

A Wage Deduction Order was filed in Cook County against the employer. Service was had on the payroll office in Illinois. Employer filed its response declining to honor the WDO. It reasoned that
because the defendant now resided in Texas and because that the Texas State Constitution specifically prohibits wage garnishment, it could not deduct pursuant to the WDO. A contest was filed to the employer’s “no funds” answer.

It was Plaintiff’s contention that Texas must give full faith and credit to the Orders issued by the Illinois Court. In support of its contention, Plaintiff’s attorney offered two cases on point:
Knighton v. IBM, 856 S.W. 2d 206 (Tex. App. Houston [1st Dist.] 1993) and Texaco v. LeFevre, 610 S.W. 2d 173 (Tex. App. Houston [1st Dist.] 1980). Both are recent Texas cases which stand
for the proposition that Texas courts must give full faith and credit to a viable foreign Judgment.

In Knighton the Defendant resided in Texas but had been served in New York. He sought to enjoin Plaintiff from enforcing a garnishment order issued out of New York against wages earned
by Defendant in Texas. Defendant argued that, because he resided in Texas, that Texas collection procedures should control. The Court disagreed.

Following a line of cases, the Texas Appellate Court found that Texas could not deny full faith and credit to another state’s Judgment merely on the grounds that enforcement of it might offend public policy in Texas. To support this, the Court cited the LeFevre case.

LeFevre involved an attempt to enforce a foreign Judgment, by garnishment of wages, in Texas. There was a question of whether the Federal District Court was able to resolve conflicting Orders and possibly order enforcement. The Court stated that ...our state court was bound to follow the decision of the federal district court even if the effect would be to allow the garnishment of wages, which our state court could not do because of the prohibition of [the Texas Constitution].

Thus, the Knighten Court drew a distinction between the situation where a Texas Court was being asked to enforce a wage garnishment and where a Texas Court was simply being asked not to
interfere in such an enforcement. Knighten at 210. The wage garnishment would be allowed in the latter circumstance.

This is the gist of the argument which was presented to Judge Betar. Looking at these cases and in light of the fact that Defendant’s wages were being paid out of Illinois, Judge Betar directed that the employer answer the WDO and deduct wages from the Defendant."

In each of the cases, a judgment had been rendered against the employee prior to his being a Texas resident and that's the kicker, these were transplanted Texans, who didn't get here fast enough.

But in general, there are only 3 instances where wages are garnished in Texas.

1. Certain federal tax obligations
2. Child Support
3. Student loans

[CindyLou]

If my memory serves me right the cases of garnishments involved residents of Texas that worked for companies that had headquarters based in other states.....I could be wrong...but it seems there was a twist. It wasn't just a straightforward Texas resident working for a Texas based company.

[GoingDown]

If my memory serves me right the cases of garnishments involved residents of Texas that worked for companies that had headquarters based in other states.....I could be wrong...but it seems there was a twist. It wasn't just a straightforward Texas resident working for a Texas based company.

Yes, this has been confirmed by Bud Hibbs.

If they are being paid by an out of state company, their wages can be garnished.

The solution is simple if you live in Texas. Get a job with a Texas company and your wages can't be garnished. Don't work for out of staters.

[Granny]

I researched the cases, see my previous post. It's not a matter of working for a Texas company. It's a matter of not getting a judgment in another state and then moving to Texas hoping to avoid the garnishment.

Those cases had a judgment entered while the employee was a resident of another state where garnishment is allowed and then moved to Texas and attempted to claim exemption. Because the judgment was obtained in another state, it was upheld in Texas because

Texas courts must give full faith and credit to a viable foreign Judgment

[treehugger1]

Exactly, Granny! The judgment were already in place prior to the "defendent" moving to Texas. It appears that Texas does allow outside entitities to follow through on legal remedies obtained at a time the debtor was not a citizen of the state of Texas.