Bank Garnishment from a Debtor’s Perspective

Texas does not allow a judgment creditor to garnish your wages for a judgment unless that judgment is for child support or spousal maintenance. But, Texas does allow a bank garnishment for any civil judgment. You can read more about the distinctions between these two types of garnishments in my previous post Clearing Up the Confusion on Texas Garnishment Law.

The Basics of Garnishment

Garnishment allows a judgment creditor to take possession of certain property you own that is in the hands of a third party. The most common type of garnishment in judgment collection cases is a bank garnishment.

The bank is the third party having possession of money in your account. The bank is indebted to you for an amount equal to the money in the account. When a judgment creditor files to garnish your account, he is asking that the bank turn over the money it owes you so those funds can be applied to pay your judgment.

The Timing of a Garnishment

Your judgment creditor may seek a writ of garnishment for your bank account only in specific situations.

1. The judgment against you must be a final judgment.

For garnishment purpose, a judgment is final when the judge signs it. The creditor, therefore, can apply for a bank garnishment on the day the judge signs the judgment. But, the creditor must also meet each of the other requirements must too.

2. A garnish is not allowed if you are appealing the case, and you file an approved supersedeas bond to suspend execution of the judgment during the appeal.

3. The judgment creditor must sign an affidavit stating that, to his knowledge, you do not own property in Texas that can be seized to pay the judgment.

An affidavit is a written statement under oath. The judgment creditor does not have to proof you lack property sufficient to cover the judgment. He only has to state that, to his knowledge, you do not have such property.

Responding to a Bank Garnishment

There is no guarantee that you can do anything to defeat a bank garnishment. But, there are several things you can do to make sure your judgment creditor follows both the letter and the spirit of the law during the garnishment process.

If, for example, you do own nonexempt property in Texas that may be taken to pay the judgment and the creditor files a writ of garnishment, he could be liable for a wrongful garnishment. Remember, the creditor must sign an affidavit stating under oath that, to his knowledge, you do not own enough property subject to execution to pay the judgment. If that statement is untrue, the creditor may be liable for a wrongful garnishment even if he had probable cause to believe the statement was true, and he did not act maliciously.

A judgment creditor has a duty to make a reasonable inquiry to determine whether you have nonexempt property that is subject to seizure for the judgment. The way your credit makes a reasonable investigation is usually with Interrogatories in Aid of Judgment. If you get such interrogatories, you are under an obligation to answer them completely and truthfully under oath. You cannot hide your assets and then make a claim that your creditor wrongfully garnished your bank accounts.

If you answer post-judgment Interrogatories truthfully and disclose your ownership of nonexempt property the creditor can seize to pay the judgment, that answer gives the creditor actual knowledge of the existence of such property. If the creditor then files for a bank garnishment without first seizing the nonexempt property you have disclosed, you may have a case for wrongful garnishment.

2 Responses to Bank Garnishment from a Debtor’s Perspective

  1. What’s to keep the debtor from taking the $$ out of the bank account that he just told me about, before I can get the Writ to the bank?

    • There is absolutely nothing to keep him from doing just that. And, I’ve had it happen.

      But, the debtor is legally obligated to update information in post-judgment interrogatories when asset information changes. He can’t claim he doesn’t know that he has such a duty because I include a notice of that duty in the interrogatories. So, what I do when a debtor moves money after disclosing its location in interrogatories is send a letter informing him of his duty to update me with the information.

      Most judgment debtors will ignore the letter. That is a mistake because at that point I can file a Motion to Compel and start the process toward contempt if he persists in his refusal to disclose the new location of the accounts.

      At some point during this “cat and mouse game” debtors realize I’m not going away so I either successfully garnish the account or they enter a settlement agreement with me.

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Harvey L. CoxMy name is Harvey L. Cox.  I've been practicing law in Texas since 1990. I have worked extensively in the areas of commercial and consumer collections, consumer protection, IRS problem solving, asset protection planning, estate planning, and child advocacy. I now devote my time writing and teaching with a desire to help consumers and small businesses find answers to their everyday legal and business questions.

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