Questions about garnishing accounts...

[junker]

after someone gets a judgement, there isnt a lot of law protecting your bank or credit union acct from seizure,, although if there is exempt funds such as social security they technically have to give it back, BUT they might seize it anyway and force you to go to court to get it back..

[Wantmypeace]

So, what is the purpose of the law that says they can only garnish your wages up to 25%, if they can just wait a day until you deposit your paycheck and take the other 75%?

[junker]

you are talking about two different things... they can garnish your PAYCHECK for 25% if you have other funds in a bank acct not proven to be paycheck expecially saving acct... i believe they can take that also...they can make life uncomfortable for you... they take it and make you prove its exempt...one poster had a roommate that used her checking acct.. they took all of her money also...im sure someone more knowlegable will chime in here

[Wantmypeace]

So, if the only thing that goes into my account each month is my paycheck, I should be okay? Is that right? Thanks for your help!

[junker]

California is a community prop state, so i am not sure if they can go after spouses income if it is comingled. so be careful on that point. but i believe you are correct, if just your paycheck is going in they can get the 25% and remember they have to sue you first and get a judgement...depending on what you do to stall them it could be a while....but with 70k in cc debt pretty sure someone will go after you ....one more thing... the 25% WAGE garnishment takes place at employer level.... not necessarily the bank...so it will come out of your check before it hits the bank

[treehugger1]

Everyone needs to understand some details here. Suppose you are in a 25% wage garnishment state. Suppose you make $1000. After garnishment, you take your $750 remaining and place it in a bank account. Technically, the $750 is exempt from seizure, since it is what remains after the 25% garnishment. On the other hand, suppose the creditor, CA, etc also has a writ to levy your bank account. The bank doesn't know if the $750 is exempt, and it is not their responsibility to protect your exempt funds. The bank must act on whatever legal instrument they have served on them. It is your responsibility to protect your exempt funds. So, yes it is possible to have a 25% wage garnishment, and also have a bank levy. If the funds on deposit are what remains after garnishment, you can make the argument that the funds must be returned to you. It could be up to you to make the argument that exempt funds were taken.

Once you have a judgment against you, one would think the wisest move is to get any money you have out of your bank account. Open a new account somewhere. Or, don't use a bank account at all.

[optimistic1]

California is a community prop state, so i am not sure if they can go after spouses income if it is comingled. so be careful on that point.

They most definetely can garnish both of the spouses wages, in a community property state, the law sees you as 1 entity. I live in a comm. property state, and this has been told to me by numerous attorney's that I interviewed, whether or not the garnishing firm or creditor actually does it, is another topic.

[optimistic1]

Once you have a judgment against you, one would think the wisest move is to get any money you have out of your bank account. Open a new account somewhere. Or, don't use a bank account at all.

careful treehug, I suggested that in another post, and was told I was violating the forum rules.

[Wantmypeace]

I did open a new bank account, and it is not connected to any of my creditors, but I am worried that they will somehow find it since they are so cunning. I have no other way to get my check but by direct deposit, so I'm not sure how to protect the other 75% of my income. I can take it out immediately, but if they put a levy on the account, also, then I'm stuck. Maybe I'm borrowing trouble here....maybe, I just need to wait until I am informed that I have a judgment before I get too worked up....

[treehugger1]

Yeah, I read that. But suggestions to protect exempt assets is not against forum rules, as far as I know. If such forum rules were to change, the board would lose a great deal of "experience." And, I agree with your reply. Laws and statutes are there for everyone to apply to the best of their knowledge; lender and borrower.

Keep in mind even the lowest level laws and statutes are open to interpretation. If not, everything would be clear and we wouldn't need attorneys, judges, and jurors to sort it all out. Being the least-sophisticated consumer can have its pros and cons! LOL.

[treehugger1]

Nothing "legal" can occur before a judgment, but you are wise to protect your assets; real, cash, or otherwise. That's what a good BK attorney should do for you also. Bank accounts that you used to pay unsecured debts create a record and trail that any "unscrupulous" CA or oregonal creditor can follow. There are numerous posts on this board related to pre-paid debit accounts and/or stock trading accounts, and many of these have direct deposit options. You'll need to do your own research in this area.

[junker]

5. California Wage Garnishment

Up to 25% of the debtor's net disposable earnings. Once the levy has been served on the employer by the sheriff or marshal, it remains in effect until the judgment has been paid in full. Because California is a community property state, the wages of a non-judgment debtor spouse are also subject to levy

[Wantmypeace]

This whole thing is very scary. I'm genuinely trying to do this the right, legal way, pay any debts I can, and get into a position where I can be a "productive member of the economy" again. However, it can be very difficult when you're not sure who to trust or what to believe. Even the laws don't really protect you when you trust them. I definitely need a good attorney to help me out with this...

[No Gravy]

I read through to the end of this thread, in case there was a clarifying post about what you stated here. I have to say, I'm very confused.

I've seen it mentioned often in these forums (including the BK ones and not just the collection ones) to consider cashing paychecks and paying for everyday bills using cash or money orders, and not keep your living expenses in a bank account that may be subject to garnishment, etc.

The OP's question was in reference to an "emergency fund" and money to pay for rent, gas, food, etc. All exempt. Optimistic's suggestion was to have a place to keep said cash, which is used for everyday expenses, not for hiding assets from the court.

Wild card exemption or not, I recall seeing no where that the use of cash was not allowed, and debtors were required to use only checks and to keep all their money in bank accounts. As long as it's accounted for, I've never seen any reference to a problem.

I'm not trying to start trouble, and maybe you were just having an off day (like we all do), but for the benefit of anyone else coming along later and reading your words, I think some clarification would be a good thing.

[lrprn]

I'm not trying to start trouble, and maybe you were just having an off day (like we all do), but for the benefit of anyone else coming along later and reading your words, I think some clarification would be a good thing.

Yep, off day. I mis-read the OP's original reference to an emergency fund. Thanks for catching my error.