What assets do creditors target after winning a debt lawsuit?
Summary
When a creditor wins a debt lawsuit, they may try to collect money by going after certain assets of the borrower. Creditors often target bank accounts, wages, investment accounts, real estate equity, and valuable personal property, but laws protect some assets from being taken.Key Facts
- Creditors can freeze money in checking and savings accounts through a bank levy with court approval.
- Federal benefits like Social Security are usually protected and cannot be taken from accounts.
- Wage garnishment allows creditors to take a part of a person’s paycheck, but federal and state laws limit how much can be taken.
- Investment accounts such as stocks and bonds may be used to pay debts depending on state laws.
- Creditors can place a lien on real estate, which can affect selling or refinancing the property later.
- Many states have homestead exemptions that protect a certain value of home equity from creditors.
- Creditors may also try to claim valuable personal property, subject to exemptions and local laws.
- The exact rules for what assets can be taken vary by state and depend on the type of debt involved.
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