Bank Account Garnishments

This guide is intended for people who are concerned that their bank account may be garnished by a creditor. It explains: 

• Who is part of the bank account garnishment process
• How the garnishment process works
• What money is protected
• What you can do next

Can a creditor take my bank account?

A creditor is a person or company you owe money to. The debtor is the person who owes money. 

A creditor who has an active court judgment against you can take money from your bank accounts using a Writ of Garnishment. A court judgment is when a judge makes a decision. This is official and must be followed. A creditor who has not gone through the court process and won their case against you can’t legally take funds from your bank account without asking you.

After a creditor gets a court judgment stating that you owe them money, the creditor can ask the court to issue a Writ of Garnishment. The clerk of court issues the “Writ of Garnishment with Notice of Exemption and Pending Levy”, more commonly called a Writ of Garnishment.

What happens if my bank is served with a Writ of Garnishment?

The creditor must personally serve your bank with the Writ of Garnishment. Your bank is called the garnishee. 

Next steps:

1. The bank looks at the sources of income for the bank account. 
2. If the money in the account is directly deposited from Social Security (including SSDI or SSI), the bank should not freeze that account for the last 60 days of federal deposits. The bank should tell the creditor that the funds are exempt (protected under law) and cannot be taken. Any amount over the last 60 days of deposits can be frozen. The automatic exemption only applies to the account the funds are deposited into.
3. If the bank cannot see the money is from Social Security, the bank will put a freeze or hold on the account. The bank will not give the money to the creditor or to you until they get directions from a judge.
4. After the bank is served paperwork, the creditor then has to serve you with the Writ of Garnishment. They can do this by: 
   • Giving the writ to you or someone in your home 18 or older
   • Leaving the writ at your work
   • Mailing you the writ 
   • Emailing you the writ  

What can I do about a bank garnishment? 

You can file a Claim of Exemption. 

If you have less than $2,500.00 in your bank account(s), your money is protected. This protection is not automatic, and you must file a Claim of Exemption if you want to protect the money.     

There are many other protections for other types of income and funds. Look at the “Partial List of Exempt Property” on page 3 of the Writ of Garnishment you were given.

When do I need to file the Claim of Exemption?

The Claim of Exemption must be filed within 14 days of when you are served with the Writ of Garnishment with Notice. This is from the day when the creditor serves the writ on you. 

OR 

If you learn of the garnishment before you are served with the writ, you can file the Claim of Exemption at any time. Your bank will often tell you before you are formally served.

Where do I find the forms to file?

Use Form 30: Claim of Exemption to Writ of Garnishment with Notice.

Use the form to tell the judge what property is being held (funds in your bank account) and why the creditor shouldn’t get that property. 

• If the funds are from Social Security, you should list this law: 42 U.S.C. 407
• If the funds are less than $2,500 you should list this law: C.R.S. 13-54-102(1)(w)

You will need to file the Claim of Exemption in your court case by:

1. Going to court and filing it with the clerk.
2. Mailing a copy of the Claim of Exemption to the plaintiff or their attorney (if they have an attorney).

Always keep a copy for yourself.

What happens after I file the Claim of Exemption?

The judge must schedule a court hearing within 14 days to decide whether the money should be given to you or to the creditor. 

The creditor may decide that you are right and will file a “Release of Garnishee.” This means that the bank (the "garnishee") is told that they can give the funds to you and that the writ is no longer in effect.

What happens at the Claim of Exemption court hearing?

Bring documentation to show that your bank funds are protected. If the amount in your accounts is under $2,500 you may not need extra documentation. If you have more than $2,500 in your account, you have to show where the money came from to prove it is exempt. 

The judge will make a decision in writing if the money will be returned to you or to the creditor (or divided between both of you).

How long does the Writ of Garnishment last?

A Writ of Garnishment with Notice of Exemption and Pending Levy can only be used 1 time. If a creditor wants to try to garnish a bank account more than once, they must request a new writ from the clerk of court every time. There is no limit on how many times they can garnish your accounts. 

Need more help?

If you are low-income, a senior, or a veteran, you may qualify for free legal help from Colorado Legal Services (CLS). To apply or ask if you might qualify, go to the CLS website and find the office that serves your area. If you call or visit, CLS can help you in your native language.

You can get help from the courts. Every judicial district has staff called “Sherlocks” to help people with their legal questions. To find the Sherlock in your county, visit the Judicial Department’s Sherlock webpage.