When a person in California has debt and does not pay it, creditors have certain legal actions they can take to recover that debt. One of those options is to garnish a person’s bank. However, can the creditor also garnish the debtor’s spouse’s bank account? Keep reading to find out, and then contact The Law Offices of Paul Y. Lee at 951-755-1000 if you require a free consultation with a bankruptcy attorney.
California is a Community Property State
The relevant information to focus on hereis that California is a community property state, which means that legallymarried couples jointly own everything – including debt. As a result, it ispossible for a creditor to garnish a spouse’s bank account if their spouse owesa debt. It is difficult enough to have any bank account garnished, but when itis for your spouse’s debt, it can be even more difficult to accept.
How Bank Garnishments Work in California
It is not true that just any company cangarnish your bank account. Before they can take action, the creditor will needto obtain a court judgment that affirms the debt is owed by you to them. Whenthe judgment is received, the creditor can then petition the court for a writof execution, which can be delivered to you and/or your spouse’s bank by thecounty sheriff.
More About the Writ of Execution
The judgment creditor is able to accessdeposit accounts, joint accounts, your spouse’s personal bank account, and anybank accounts that you and/or your spouse have under a fictitious businessname. Note that the Writ of Execution only applies to funds that are in theaccount at the time the sheriff serves it.
What Happens When the Writ of Execution is Received?
When you or your spouse’s bank gets theWrit, they are required to freeze all accounts. From that moment on, any frozenfunds cannot be accessed. You cannot get money out of an ATM, you cannot writea check without it bouncing, and you cannot take money out of the bank itself.The sheriff is required to notify you of the freeze so it will not come out ofnowhere. Once the levy has happened, you have ten days to submit a challenge.
Bankruptcy Will End the Freeze
If your funds are frozen and you file for bankruptcy, then they will be unfrozen. This is because once you have filed, all creditors are required to stop all attempts at collection until the bankruptcy is completed. If you have questions about how to file for bankruptcy or what other advantages it brings to you, contact The Law Offices of Paul Y. Lee at 951-755-1000 for a free legal consultation.
FAQs
As a result, it is possible for a creditor to garnish a spouse's bank account if their spouse owes a debt. It is difficult enough to have any bank account garnished, but when it is for your spouse's debt, it can be even more difficult to accept.
Can my husband's bank account be garnished for my debt? ›
In California, creditors can usually look to a non-debtor spouse's assets to collect on a judgment.
Can a debt collector take money from a joint bank account? ›
Your joint account may be garnished for that debt even if you did not owe that debt. Your account may be garnished whether or not you own it separately from your spouse. Creditors may not be able to garnish your account at all.
Can debt collectors take money from spouse? ›
Debts either spouse incurred during marriage
Property acquired during marriage is liable for the debts of either spouse. So, a creditor whose claim arose during the marriage can collect your spouse's unpaid credit card debt from both halves of the community property, including your wages.
Can a levy be placed on a joint bank account? ›
Joint Bank Account Levies
It doesn't matter whose funds were placed into the account. Under the Internal Revenue Manual, the IRS levy can attach to a bank account for which the taxpayer has an unrestricted right to withdraw funds, regardless of who deposited those funds.
How do I protect myself from my husbands debt? ›
You can protect yourself from your spouse's debt by signing a prenuptial agreement before you get married and avoid taking out joint credit. It's especially important to protect equity in your home during a divorce to ensure you get your fair share, since this is likely the largest asset you have.
Can a wife be held responsible for her husband's debt? ›
Since California is a community property state, the law applies that the community estate shared between both individuals is liable for a debt incurred by either spouse during the marriage. All community property shared equally between husband and wife can be held liable for repaying the debts of one spouse.
What type of bank account cannot be garnished? ›
Retirement accounts like 401ks and IRAs have special protection from creditors and debt collectors. Under federal law, 401ks and other ERISA-qualified plans cannot be garnished by creditors. IRAs also receive protection up to $1 million (adjusted for inflation) under federal bankruptcy law.
Which states prohibit bank garnishment? ›
What States Prohibit Bank Garnishment? Bank garnishment is legal in all 50 states. However, four states prohibit wage garnishment for consumer debts. According to Debt.org, those states are Texas, South Carolina, Pennsylvania, and North Carolina.
Can a creditor take all the money in your bank account? ›
Yes, a debt collector can take money that you owe them directly from your bank account, but they have to win a lawsuit first. This is known as garnishing. The debt collector would warn you before they begin a lawsuit.
A debt collector can contact your spouse. A debt collector can contact your parents or guardian if you are under 18 years old or live with them. A debt collector can also contact your attorney and, if otherwise allowed by law, credit reporting companies (Equifax, Experian, and TransUnion) about your debt.
Can wife be sued for husbands debt? ›
In California, when a couple marries, all assets they acquire following the union are deemed marital assets under their community property laws. Essentially, this means they are owned equally by both parties in the marriage. As such, any debt acquired by your spouse during your marriage essentially becomes yours.
Can creditors go after my spouse for my debt? ›
In a community property state, creditors of one spouse can go after the assets and income of the married couple. This ability is powerful because most debts incurred during marriage are joint debts, regardless of whose name is on the title (in most community property states).
Can my bank account be garnished for my husband's debt? ›
California is a Community Property State
As a result, it is possible for a creditor to garnish a spouse's bank account if their spouse owes a debt. It is difficult enough to have any bank account garnished, but when it is for your spouse's debt, it can be even more difficult to accept.
Can garnishment be taken from a joint account? ›
Learn about your rights. Creditors might be able to garnish a bank account (also referred to as "levying" the funds in a bank account) that you own jointly with someone else who isn't your spouse. A creditor can take money from your joint savings or checking account even if you don't owe the debt.
Can debt collectors come after a joint account? ›
Yes. When you have a joint account, each account holder is responsible for the full amount of the balance. The credit card company can seek to collect the amount due from either account holder. If you no longer want to be responsible for the joint account, contact your credit card company to learn your options.
How can I not be responsible for my spouse's debt? ›
The bottom line
You are generally not responsible for your spouse's credit card debt unless you are a co-signer for the card or it is a joint account. However, state laws vary and divorce or the death of your spouse could also impact your liability for this debt.
When a person in California has debt and does not pay it, creditors have certain legal actions they can take to recover that debt. One of those options is to garnish a person’s bank. However, can the creditor also garnish the debtor’s spouse’s bank account? Keep reading to find out, and then contact The Law Offices of Paul Y. Lee at 951-755-1000 if you require a free consultation with a bankruptcy attorney. 