What happens after a debtor wins an exemption hearing for a writ of garnishment?
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What happens after a debtor wins an exemption hearing for a writ of garnishment?
After receiving a writ of garnishment and having my bank account frozen, I filed an exemption form because my only income is a life insurance annuity resulting from a personal injury claim. I had an exemption hearing today and the writ was dissolved, with the only question the judge asked me being how much money I had in my account (less than zero). Does this mean that the creditor can come after me again the next time I have money in my account, or that they can try to take my assets, or is this debt forever resolved now that I won the exemption hearing?
Asked on May 2, 2011 under Bankruptcy Law, Florida
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 12 years ago | Contributor
You won a skirmish, not the war. The fact that your life insurance annuity income is exempt from garnishment does not mean that the debt is gone or that the creditor may not have other recourse. For example, if you should have non-exempt income (e.g. win the lottery; inherit something; given a gift; get a paying job; rent out a room in your home; etc.), the creditor can go after that money. Or the creditor can seek to execute on certain of your assets (if you have any), like a second home (FL's homestead exemption ought to protect your primary residence), motor vehicles, a brokerage account (if you had one), etc. To the extent that all you have is the annuity income, you should be in good shape from what you write; but other income or assets are potentially vulnerable.
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