Can a Bill Collector Debit a Bank Account Without Permission?

Being harassed by a debt collector is stressful, and confusion about what the collection agency can and can't do to get its money can make a bad situation worse. Knowing your rights is a crucial part of dealing with the collection process. When it comes to your bank account, bill collectors need to satisfy some requirements before they can debit your account.

Pre-Judgment Collections

If your account is in collections, but the bill collectors have not sued you and won a judgment, they cannot take money from your bank account without your permission. They can only debit your bank account if you agree to a payment and provide them with your account details for the purposes of making that payment. They can only take the payment or series of payment you authorize.

Post-Judgment Collections

If bill collectors cannot obtain payment from you, they can sue to try to recover the debt. If they win their case, they can then request that the court give them a garnishment order against you. With the garnishment, your bill collector is legally entitled to ask your bank to hand over the money in your account to cover your debt without your permission. They can only take up to the amount of their garnishment order.

Protecting Yourself

Don't ignore notices from collections agencies threatening lawsuits or notices that a case has been filed against you. If you don't respond, the collection agency can get a judgment against you in your absence and you will lose your opportunity to answer their claims or to set up payment arrangements before they win a garnishment against you. A lawyer can help you understand your rights if a collection agency sues you. Your state bar association can help you find a lawyer who specializes in your type of case.

Unauthorized Debits

If a bill collector debits your bank account without your permission and without a garnishment order, you have the right to sue. According to the Federal Trade Commission, you have up to one year from the date of the violation to file the case. If you win your case, you can be awarded up to $1,000 plus any damages you can prove you suffered from their unauthorized debit. You should also report any bill collector violations to your state attorney general's office.