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

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

Answer from AI:

In Texas, the ability of a credit card company to freeze your bank account, especially when it contains pension funds, involves several legal considerations. Understanding these can help you navigate your rights and obligations.

Understanding Judgment and Garnishment

A credit card company cannot directly freeze your bank account without first obtaining a court judgment against you. Here’s a general outline of the process:

1. The credit card company must sue you in court for the unpaid debt.
2. If they win the lawsuit, the court will issue a judgment against you.
3. With the judgment, the credit card company can seek a writ of garnishment to freeze your bank account.

Exemptions for Pension Funds

In Texas, certain types of income are protected from garnishment, including most pension funds. According to Texas Property Code Section 42.0021, retirement benefits are generally exempt from garnishment, attachment, execution, or other seizure.

• Social Security Benefits: These are protected under federal law (42 U.S.C. § 407).
• Private Pensions: Many private pensions are protected under the Employee Retirement Income Security Act (ERISA).
• State and Local Government Pensions: These are typically protected under state laws.

Steps to Protect Your Pension Funds

If you are concerned about your bank account being frozen, consider the following steps:

1. Identify Exempt Funds: Clearly identify which funds in your account are from pensions or other exempt sources.
2. Notify Your Bank: Inform your bank that your account contains exempt funds. Provide documentation if necessary.
3. Respond to Legal Notices: If you receive a notice of garnishment, respond promptly and assert your exemptions.
4. Consult a Legal Professional: Seek advice from an attorney to ensure your rights are protected.

When to Seek Legal Advice

While this information provides a general overview, individual circumstances can vary significantly. It is crucial to consult with a legal professional to get personalized advice, especially if:

• You have received a court judgment or garnishment notice.
• You are unsure about the exempt status of your funds.
• You need assistance in asserting your exemptions in court.

Additional Resources

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

• Texas Property Code Section 42.0021
• Social Security Act Section 407

Remember, while general information can be helpful, it is no substitute for professional legal advice tailored to your specific situation.