Collections Agencies and Your Bank Accounts
If a court issues a judgment against you, federal law allows a debt collector or collections agency to take money from your account to satisfy, or pay toward, your debt. This can be done in lieu of garnishing your wages, which is no picnic, either. In any case, here’s what you should know about collections agencies and your bank accounts. Garnishing Your Bank Account Before any bank account garnishment takes place, the Fair Debt Collection Practices Act directs that the collection agency must give you 30 days, through written notice, to clear the debt. After that, the collection agency is allowed to sue you and the court then must file a judgment against you. Only then can garnishment occur, and even with that, the process varies among states. What About Exemptions? Govern...
