Can my bank or credit union charge me a fee for processing a garnishment if I receive Social Security or VA benefits?
Yes. Your bank can charge a garnishment fee, but only if you have more than 2 months’ worth of benefits in your account. If your account balance is less than 2 months’ worth of Social Security or VA benefits, your bank has to protect that amount – period. The bank can’t charge garnishment fees against this protected amount. The bank is not allowed to charge fees for this garnishment later, when you have more funds.
If you think your bank charged a garnishment fee when it shouldn’t have:
- Call your bank and explain why you think the garnishment fee is wrong.
- Consider seeking legal assistance. The Center for Elder Rights Advocacy can refer you to a local agency that provides free legal help to seniors who qualify. You can call the Center for Elder Rights Advocacy at: (866) 949-2372 or visit: LegalHotlines.org.
- You can also find a lawyer in your state by visiting AskCFPB.
- You can use our sample letter to tell a collector that you receive protected income from Social Security or VA benefits. Check out the sample letter and instructions here.
- If you’ve had a problem with debt collection, you can submit a complaint online or by calling (855) 411-2372.