Can a Credit Card Company Freeze My Bank Account in Texas?

Question from Sue, Can a Credit Card Company Freeze My Bank Account in Texas?

Answer from AI:

If you are retired and only receive Social Security benefits, you might be concerned about a credit card company freezing your bank account due to a judgment. Here’s a general explanation of the legal landscape in Texas and the USA regarding this issue.

Understanding Judgments and Bank Account Freezes

When a credit card company wins a lawsuit against you, they obtain a judgment. This judgment allows them to take certain actions to collect the debt, such as garnishing wages or freezing bank accounts. However, there are specific protections in place for certain types of income, including Social Security benefits.

Social Security Benefits Protection

Under federal law, Social Security benefits are generally protected from garnishment by creditors. According to the Social Security Administration (SSA), these benefits are exempt from most creditors’ claims, including credit card companies. This means that if your only source of income is Social Security, these funds should not be subject to garnishment or freezing.

Relevant Laws and Regulations

– **Social Security Act**: Section 207 of the Social Security Act (42 U.S.C. 407) protects Social Security benefits from garnishment, levy, or other legal processes.
– **Federal Banking Regulations**: Banks are required to protect Social Security benefits from garnishment. They must review accounts and ensure that protected funds are not frozen or seized.

Steps to Take if Your Account is Frozen

If your bank account has been frozen despite containing only Social Security benefits, you should take the following steps:

1. Contact Your Bank: Inform your bank that the funds in your account are from Social Security and are protected from garnishment. Provide any necessary documentation to prove the source of the funds.
2. File an Exemption Claim: In Texas, you can file a claim of exemption with the court that issued the judgment. This claim will assert that the funds in your account are exempt from garnishment.
3. Consult a Legal Professional: It is advisable to seek legal advice to ensure your rights are protected. An attorney can help you navigate the process and file the necessary paperwork.

When to Seek Legal Advice

While the information provided here offers a general overview, individual circumstances can vary significantly. If your bank account has been frozen or you are facing other legal actions from creditors, it is crucial to consult with a legal professional. An attorney can provide personalized advice based on your specific situation and help you take the appropriate steps to protect your income.

Additional Resources

For more information, you can refer to the following resources:

• Social Security Administration: Your Payments While You Are Outside the United States
• Consumer Financial Protection Bureau: Garnishment of Social Security Benefits

Remember, while general information can be helpful, it is no substitute for professional legal advice tailored to your specific circumstances. Always consult with a qualified attorney to address your legal concerns.