Can they raid my ex-wife's bank account?

[tenunda]

I am about to close all checking and savings accounts in my name and set it up so that my wages are deposited into my ex-wife's banking account.

Within the state of Texas, would a collection agency with a judgment be able to raid my ex-wife's bank account?

[treehugger1]

I've heard it can be difficult to levy/garnish co-mingled accounts, however, I would not care to be a test subject.

If you are simply trying to protect exempt wages, why not open on of the numerous debit cards that are out there. Many don't pull a credit report or report to chexsystem. Many allow direct deposit of paychecks and some go as high as $10K - $15K. Most of these are VISA/Mastercard type of accounts, and I don;t know if they even meet the definition of a bank account.

I would certainly not want to test the waters of co-mingled funds, but maybe others can weigh in on this.

If your employer requires direct deposit, then you probably need to be careful of putting your wages in a bank account.

If your employer does not require direct deposit, you might find a "check-cashing" place that has reasonable fees. Pay the fees, cash the check and buy some $500 - $2500 prepaid cards.

This is all my opinion, but protect all you can while you work through this crisis.

[magyar123]

If you trust your ex with your money. go ahead. But be warned that agency can get you by garnishing your wages.

[jp2861]

If you trust your ex with your money. go ahead. But be warned that agency can get you by garnishing your wages.

When did they start garnishing wages in Texas?

[lrprn]

From http://www.fair-debt-collection.com/...nishments.html -

44. Texas Wage Garnishment

Wages cannot be attached or garnished, except for child support.

Income that is not a wage can be garnished or ordered turned over to a receiver.

Bank accounts, rents and royalties can be garnished.

Exemptions include social security benefits.

WARNING For individuals living in Texas who are paid from an out of state location, there is case law (Baumgardner vs. Sou Pacific 177 S.W. 2d 317) to support taking a judgment from Texas, domesticating the judgment in the foreign state, then filing the wage garnishment there. Many creditors have used this strategy successfully.

[emoney]

Your actions seem to be a path to avoid a lawful judgment by transfering money without any consideration. That sir, by defination is a fraudlient transfer. All such transfers can be reversed.
I to live in Texas and we have many laws that protect debtors from collection activites that most other states allow. If you need a bank account keep the balance low, something under $100 or some amount that you could afford to lose.
Either make arrangement for payment of the judgment or file BK and get on with your life is what I would do.
regards,
emoney

[tenunda]

Your actions seem to be a path to avoid a lawful judgment by transfering money without any consideration. That sir, by defination is a fraudlient transfer. All such transfers can be reversed.
I to live in Texas and we have many laws that protect debtors from collection activites that most other states allow. If you need a bank account keep the balance low, something under $100 or some amount that you could afford to lose.
Either make arrangement for payment of the judgment or file BK and get on with your life is what I would do.
regards,
emoney

Yes, I would like to file for BK, but I can't at this time. Until I am able to, I need to protect what money I do earn so that I can pay my bills each month.

They cannot garnish wages within the state of Texas, but I understand they can raid your checking account.

Since there is no law that requires me to have a checking account in my name, I don't see why it would be a problem to deposit my wages into another person's account so that my wages cannot be touched. I make only just enough to get by each month so I can't afford to have anything taken at this time.

This is why I was asking if they can raid another person's account. Would they even know that I was using this person's account? Are they able to find out where I'm having my wages direct deposited?

In a sense I'm giving my ex-wife my money, and in exchange she manages it and pays my bills while keeping child support costs for herself.

For now there is no judgment, but I am making plans should one be issued against me. If this is all done before a judgment can be made, how would that be fraudulent transfer? I am only trying to protect my wages so that I can support my family.

[treehugger1]

In my opinion, I would not co-mingle funds.

In some states, wages that are exempt from garnishment, remain exempt when placed on deposit. I doubt this offers much help, as I'm sure that once a bank acount is identified, the burden of proof is on the debtor (after the fact.) Why not move to "cash-and-carry?"

[magyar123]

In my opinion, I would not co-mingle funds.

In some states, wages that are exempt from garnishment, remain exempt when placed on deposit. I doubt this offers much help, as I'm sure that once a bank acount is identified, the burden of proof is on the debtor (after the fact.) Why not move to "cash-and-carry?"

He can't move to "cash and carry". His employer requires direct deposit of his pay.
As far as him changing his direct deposit into his ex's bank account is concerned - his funds should be safe there from any theft attempts by collection goons.
Unless his employer is forced/strong armed to reveal into which bank/account # his pay is automatically deposited, his ex could raise a WTF is this - if those goons try to rob that account.

[emoney]

OK, so you cannot file BK now. What I would do is this continue to have salary deposited in your regular account. When the judgment is issued you should have notice.
One question I have is are you contesting the lawsuit? If not, why not?
When the judgment is signed withdraw all but a small amount from your checking account, say less than $100.
I use a bill paying service from Chase. Most bills can be paid electronically. So your money would be in account only one day. You keep the rest in cash or better yet bank checks paybable to yourself.
This way no ex-wife involved and you are not breaking the law. If and when the judgment is final, they can force, its call discovery, you to tell them how and when you get paid and furnish bank statements all other $$$ details.
You should start planning now as you are for your salary.
A meeting with an attorney would be good, but remember they cannot tell you how to avoid paying the judgment, but you can ask leading questions to legally protect yourself.
regards,
emoney

[lrprn]

Tenuda, all the creditor has to do is put you into a situation where you are placed under oath and must tell them where your wages are going. This could happen during the judgment court date if you appear or afterwards when they can't find your account.

Also no employer is going to ignore a court order to tell where your automatic deposit is going either.

Unless your wife can prove to the court that all the money in her account is hers alone (which she can't because some of it will be yours), you are up a creek with no paddle.

Your best option at this point is to set up appointments for free or low-cost initial consultations with 3-4 bankruptcy attorneys in your area. This way you'll get sound legal advice about what's going to be possible for your creditors to do if you default. You'll also get opinions about whether moving your pay to your wife's account is a smart thing to do in your area of Texas.

I think you are going to hear it isn't a good idea, but hearing it from several lawyers will give it more weight.

[keepmine]

First of all, it's not illegal to deposit your check into any account you please. It's not a fraudulent transfer since, you have not been sued.
Having said that, your ex is an ex for a reason. Noway I'd go down that road.

[tenunda]

In some states, wages that are exempt from garnishment, remain exempt when placed on deposit. I doubt this offers much help, as I'm sure that once a bank acount is identified, the burden of proof is on the debtor (after the fact.) Why not move to "cash-and-carry?"

I'm sorry, I honestly didn't see this part of your post earlier.

Do you know of where I could find more information about this?

One question I have is are you contesting the lawsuit?

Yes, I am, currently. If they're going to get a judgment against me, I figure I might as well make them work for it. If anything I was told that would at least delay the process a little, and the more time I can give myself the merrier. I also requested a validation of debt from the collection agency suing me, and I've given a copy of this request to the county clerk along with my general denial of all claims.

I use a bill paying service from Chase. Most bills can be paid electronically. So your money would be in account only one day. You keep the rest in cash or better yet bank checks paybable to yourself.

Could you explain this to me, or point me in the right direction? I also remember reading somewhere that someone said that I could have my wages direct deposited onto a prepaid credit/debit card rather than into a bank account. Have you heard of this? Would this also work?


Okay, I know that I'm asking for a lot of information from you all, and I really appreciate the effort. I will be speaking to a lawyer sometime soon when next I can make myself available to the lawyer's hours, but I'm trying to get as much information before then so that I'll know what kind of questions I'll need to ask.

Just to clarify on a few things, my ex-wife is the one in charge of my finances as per our arrangement. She got the house in the divorce, but she's allowing me to stay in the house as long as I continue to pay the bills, which I do because I've still got a teenage son to support. I honestly can't afford to lose any of what I make right now.

So just to reiterate for my own personal understanding:

My wages are exempt, but they're up for grabs as long as they're in a bank account even if it's someone else's bank account. Not only that, but it may be considered fraudulent to have my wages deposited into another person's account even though the wages are being strictly used to pay for bills and other costs of living.

I'm required to have direct deposit by my employer, so there's no way around the need for having a checking account.

So how can I protect my wages? Or are my wages already protected, even after deposit? If so, is this automatic, or do I have to file for something? What are my options outside of BK given everything I've listed above?

Someone mentioned earlier that as soon as I'm notified that a judgment is issued against me that I should begin withdrawing most of the funds from my account as soon as they become available, but what happens if they place a levy on my checking account? It would all be frozen as soon as it got in there. I wouldn't be able to pay for anything then unless I had my check redirected anyway. Or is there a process that prevents this somehow?

[treehugger1]

You can google "prepaid debit cards." Yes, there are cards that allow direct deposit. Try this site:

http://www.mastercard.com/us/personal/en/aboutourcards/gift_prepaid/

[emoney]

In Texas it is hard to collect a judgment unless you own real estate or stock. It is usually not worth the legal cost to garnish a bank account with just a salary in it.
They get part of your salary, what is in the account at the time of garnishment, and then you move to another bank.
The prepaid debit card in an idea, but they can get that information from you or your employer after the judgment is final.
I would keep my life simple and keep a small amount of money in the bank, by paying all bill the day your paycheck is deposited.
If you know or expect a lawsuit and transfer money to avoid the collect of that potiental claim that is against the law, because you are doing it to avoid paying that claim. Just knowing of the claim cause you to take action is the trip-wire of a fraudlient transfer.
Have you tried to settle this debt. Most creditors know how hard it is in Texas to collect, so why should both of you spend your lives chasing eachother. For me life is too short for the games you are thinking about playing.
regards,
emoney