Arizona Wage and Bank Garnishments
Often, the most effective way to collect a judgment is with a writ of garnishment. There are two types of garnishments. A wage garnishment and the third party garnishment. Garnishments allow you to serve a writ on any person, or legal entity that holds some money or property of the debtor. The writ orders this third party to turn the debtor’s money or property over to you to satisfy the judgment.
The most common form of garnishment and often the most effective civil remedy is the wage garnishment. A writ is served on the debtor’s employer ordering the employer to withhold up to 25% of the debtor’s take home pay each pay period. The employer is ordered to send you the money they withhold from the debtor’s pay. This form of garnishment can result in collection of your judgment over time.
The third party garnishment is used most often with banks. If your debtor has a bank account with some cash in the account, you can serve the bank with the writ and the bank must then hold the money for you. You can seize the valuable items in a debtor’s safe deposit box. You can also use this type of writ to seize anything you know about in the possession of a third party. For example, you may discover that the debtor keeps a boat at a certain storage yard. You can serve the writ on the owner of the yard and the owner must then hold the boat for you.
If a third party has some of your debtor’s property, the writ of garnishment establishes a lien on that property in your favor. You must then obtain a garnishment judgment from the court to have the Sheriff or constable seize the property. If you garnish money in a bank, the bank will then forward the money to you. If you have garnished some tangible personal property, such as a boat, the Sheriff or Constable will auction the property and you receive the proceeds of the auction sale. The proceeds are applied to the balance of your judgment. The third party writ will fail if the person doesn’t have any of the debtor’s property. If there’s no money in the bank account you’re out of luck. If the boat has been removed from the storage yard you’re out of luck. Also, with personal property like a boat there may be lenders with a valid security interest in the property. If there is no equity in the boat a Sheriff’s sale would yield nothing. For this reason, it is important to know as much as possible about the debtor’s personal property (the boat) before you attempt a third-party garnishment. A debtor’s examination is the best way to learn about the debtor’s bank accounts and non-exempt personal property before attempting a third-party garnishment.