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My Bank Account Has Been Frozen: Now What?

Exempt Property

This article explains what to do when your bank account is frozen because of a debt collection judgment.

If you have a debt judgment against you, your creditors might take steps to collect directly from your bank by freezing your bank account.  This article discusses what that means and the steps you can take to try to get your account unfrozen.

Why did my bank account get frozen?

Generally, a bank account is frozen because you owe someone money.  Most creditors need to sue you in court and win a judgment in order to have your bank account frozen.  

Once a creditor gets a judgment against you, it can ask the court to issue an order directly to the bank to freeze your bank account through a "writ of garnishment."  Another common way for a creditor to freeze your accounts is to ask the court for a "turnover receiver."  A receiver is a third-party appointed by the court to find and take possession of property or bank accounts to pay the creditor.

Read more about Garnishment in Debt Collection

Read more about Receivers and Debt Collection

I did not get notice that my bank account was going to be frozen before it happened. Is that legal?

Yes. It is unlikely that you will get any advance notice of a freeze on your account before it is frozen. Although a bank must tell you if it has received an order to freeze your account, the bank will comply with the order before notifying you, which means your account will be frozen before you learn of it. 

Once your account has been frozen, a creditor must also send you notice of what property is protected (or "exempt") and a claim form that you can turn in to the court to get any protected funds returned to you. If you do not receive this notice and claim form within five days of your accounts being frozen, contact the court.

What if I have written checks or have automatic drafts set up? Will my bills still get paid?

If the amount in your account is less than the judgment, any checks or debits that have not cleared could be denied or returned. Your bank may also charge you a fee for having insufficient funds in your account, even if you had enough for the checks or debit before the freeze went into place.

As soon as you find out there’s a freeze on your account, you should contact anyone you wrote checks to and explain that you are working with your bank to resolve the problem. You should also stop any automatic drafts that you may have set up. 

Can I deposit more money into the bank account after it's frozen?

After your bank account is frozen, you may still be able to make deposits. But, if the bank accepts the deposit, it could be frozen along with the other money in the account and go to paying the debt. So, you may not have access to that money once it is deposited.  

What money in my bank account is protected from creditors?

Under Texas and federal law, some money in your account may be protected (or "exempt") from debt creditors. The following are examples of exempt income:

  • Social Security Administration benefits, including Social Security Retirement, SSI, and SSDI
  • Veterans Administration benefits
  • Temporary Assistance for Needy Families (“TANF”) funds
  • Unemployment benefits
  • Child support, alimony, and spousal support
  • Pension and retirement benefits
  • Proceeds from the sale of a homestead (for up to 6 months after the sale)

This property is exempt from collection by most creditors. However, your protected income can be taken to pay court-ordered child support, spousal support, alimony, and certain federal debt (like income taxes, IRS debt, or federal student loans).   

For more information on and a complete list of exempt property, read Property That Can Be Protected from Judgment Creditors.

If my account has exempt money in it, can it still be frozen by creditors?

If your account contains only exempt income (for example, social security), it is protected and cannot be garnished or taken by a receiver to pay a debt judgment.If an account is frozen that has only exempt money in it, you should file a Protected Property Claim Form with the court in order to secure this protected property.

If you have a mix of exempt and nonexempt money in the same account, the account is subject to being partially frozen or seized. If your account has more than 2 months’ worth of exempt money, your bank may be able freeze the additional money. If your account contains any exempt property, you should file the Protected Property Claim Form in order to secure this protected property.

See the Exempt Property in Debt Collection guide for complete instructions on how to complete and file the claim form.

My bank account has exempt money in it, but it was frozen anyway. Can I get it back?

If your account is frozen in your account and it contains any exempt money, you may be able to get the exempt money back.  

To do this, you should file a "Protected Property Claim Form" with the court.  You should have received this form, along with a "Notice of Protected Property Rights" from the creditor, and you should return it to the court listed at the top of the Notice as soon as possible. 

If your account has been frozen through garnishment, you can also file a motion to dissolve or modify the garnishment with the court. It is always best to find an attorney who can help you through this process. Use our Legal Help Directory to search for a lawyer referral service, legal aid organization, or self-help center serving your area.

My bank account is a joint account. Can it still be frozen?

Yes, joint accounts, if they hold nonexempt property, can be frozen to collect one of the accountholder's debts. 

Can my bank account be frozen for my spouse's debt?

If you and your spouse have a joint bank account, any nonexempt money can generally be frozen in a collection action against your spouse, even if your spouse incurred the debt independently or without your knowledge. It usually does not matter if your spouse does not contribute equal funds (or any funds) to the account or if they do not use the account. If your spouse has the right to withdraw funds from the joint account, the account can be frozen to collect a debt they incurred. 

However, if you and your spouse maintain separate bank accounts, without the other spouse's being named on the account and without any right to withdraw funds, a debt incurred in one spouse's name may not be collected from an account held solely in the other spouse's name. 

This article is not intended to be legal advice and does not replace the advice or representation of a licensed attorney. 

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