I have been asked this question many times if a creditors typically can garnish an account to collect a debt after obtaining a judgment. If a creditor files a non-wage garnishment affidavit upon a bank that holds your money, the bank can be forced to pay that creditor whatever money is on deposit in your account, up to the amount of the judgment. The amount garnished is not limited and the account can be drained to zero if the judgment meets or exceeds the amount on deposit. In Nevada, the garnishment cannot exceed more than 25% of your pay and that garnishment execution has to be sent to your payroll master.
A non-wage garnishment differs from a wage garnishment, also known as a payroll garnishment, in that the lock on a paycheck is limited by federal law to an amount sufficient to leave a person money to live off. The non-wage garnish is not restricted to any amount, other than the amount of the judgment.
– A wage garnishment cannot levy a social security check because it is given to you pursuant to the federal laws, and federal laws are superior as all garnishment. State garnishment mostly takes place under the state laws.
-However, in Nevada, a garnishment takes place subject to a judicial action and there would be a notice and hearing and proper service of summons and complaint.
-You have also the right to counter sue and reply.
Many debtors learn this lesson the hard way. Money saved in an account is fair game for the debt collector. So what is a person to do? Protect your money and make it untouchable. If you owe a judgment, naturally you are aware the collector is trying to collect money from you. Do not turn a blind eye to the collection process. So long as you owe debt, your assets are vulnerable. If you deposit money into an account, you expose that money to being garnished. Likewise, the converse if true. If you do not have money on deposit or held by someone for you, you a non-wage garnishment is of no consequence. Learn how to do asset protection and find out assets which cannot be touched. Try using home stead so a lien can be protected. Try using maximizing your IRA contributions. Everything in IRA is protected. May be you can split your money in various banks, so the executioner cannot take out maximum amount. Also, if you change jobs, the garnishment is stopped, and now the garnishment decree holder has to find your employer again and start those garnishment proceeding again.
If your source of income comes from a paycheck you may need to use a check cashing service until you can get the judgment released. If you cash your check and hold the money in hand, there is no one to serve with a non-wage garnishment. By holding cash, you avoid placing money on deposit
Are you a judgement proof person?
A judgement proof person’s wages cannot be garnished because a pension or social security cannot be levied under the state laws. Furthermore, if someone has only pension and social security, even if someone has judgment, there is nothing they can do to execute this judgment against. At the most, it is a piece of paper which has no material or investment value. However, once you deposit these checks in your banks, a transformation takes place. Now the judgement holder can garnish your checking account. Make sure you do not leave enough money in your bank in these cases, and pay your utilities either online or pay via cash and direct to their offices. If you are vulnerable, these sharks would come after you. So a little bit of planning is okay here. Pay cash where ever is possible, it is also good for your financial health and learn how to balance your budget.