Can a Debt Collector Attach a Pension Check?

Collection procedures usually require a long legal process, which gives you ample opportunity to prepare. Before any collector can take your money or property, it must file appropriate legal paperwork and get the court's backing. Even then, you can protect certain income, including certain pensions, from the reach of the collection agency. However, not all assets can be shielded from debt collectors with judgments.

Collection Process

Long before a collection agency gains the right to garnish or attach your assets, it generally will begin a process of contacting you by phone or mail to get you to pay. If you continue to refuse to pay, the collector may eventually file a lawsuit against you. Assuming the debt you owe is valid, the court will typically side with your creditor and issue a judgment against you, authorizing the creditor to take direct action to collect on the debt. At this point, your income, including certain pensions, becomes susceptible to garnishment or attachment.

Protected Income

Federal and state governments protect some of your wages and assets from collection, even from creditors with valid judgments. If you are receiving payments from Social Security, unemployment or any type of government pension, your creditors cannot garnish those payments.

Private Pensions

In most cases, a creditor with a judgment can garnish your pension if it comes from a non-government source, such as your company 401k plan. The federal government restricts garnishment to 25 percent of your income from non-protected sources, and some states protect your wages to an even further degree. For example, in Texas a creditor cannot garnish any of your wages.

Getting out of Collections

A creditor with a judgment can be difficult to avoid. Because most states and the federal government allow wage garnishments of up to 25 percent of your income, you cannot usually avoid paying your creditor unless you earn income only from exempt sources. You can avoid making payments if your gross weekly income is less than 30 times the hourly minimum wage. As of 2011, this amount is $7.25 per hour, or $217.50 per week. In most cases, the only way to end collections is to make payment in full or to declare bankruptcy.