Can a creditor empty your entire bank account with a bank levy?
A bank levy allows creditors to seize funds from a borrower's bank account to satisfy unpaid debts, but there are limits to this process. While creditors can access money in the account, they cannot take everything due to federal protections and state laws. Certain funds, such as Social Security benefits, are shielded from levies, and many states have exemptions that protect a minimum balance.
- ▪A bank levy can freeze and seize funds in a borrower's account after a court judgment.
- ▪Creditors can take up to the amount owed, but federal law protects specific types of funds from being levied.
- ▪Many states have laws that exempt a minimum balance from being taken and may allow debtors to contest the levy.
Opening excerpt (first ~120 words) tap to expand
MoneyWatch: Managing Your Money Can a creditor empty your entire bank account with a bank levy? We may receive commissions from some links to products on this page. Promotions are subject to availability and retailer terms. .chip { background-image: url('/fly/bundles/cbsnewscore/images/chip-bgd/chip-bgd-moneywatch.jpg'); } By Angelica Leicht Angelica Leicht Senior Editor, Managing Your Money Angelica Leicht is the senior editor for the Managing Your Money section for CBSNews.com, where she writes and edits articles on a range of personal finance topics. Angelica previously held editing roles at The Simple Dollar, Interest, HousingWire and other financial publications.
…
Excerpt limited to ~120 words for fair-use compliance. The full article is at CBS News — Top.
Discussion
0 commentsMore from CBS News — Top
