Residents in Maryland and across the nation have been anxiously awaiting the passing of the American Rescue Plan. This Plan grants eligible Americans a total of $1,400 to assist with expenses. Unfortunately, some Americans may not have access to their funds due to debt collectors.
Why can my check be seized?
The first two stimulus payments took debt collection practices into account. Unfortunately, the third stimulus check was established with no such restrictions. Currently, debt collectors are authorized to seize the $1,400 payment that citizens receive from this stimulus package.
For some with past-due credit card bills, this could be a scary thought. Thinking of this fresh money vanishing from their accounts can be heart-wrenching, especially at a time when many Americans need the financial boost. However, it’s important to realize that not just any debt collector that you owe can take the funds.
Only those with judgments can have their checks seized
When a person is severely past due on a credit card account, the company may sue him or her to get the funds. In the event this happens, the creditor receives a judgment. This allows the creditor to seize funds in various checking and savings accounts to repay the debts that are owed by borrowers. As of right now, borrowers who received a judgment against them by creditors can have their $1,400 stimulus check seized as soon as it hits their bank accounts.
While it wasn’t lawmakers’ aim to pay off consumers’ debts, the third round of stimulus checks is doing just that. Fortunately, many states have worked quickly to try and enact new laws that restrict debt collectors from seizing the third stimulus checks from Americans. Only time will tell whether or not debt collectors will continue to be able to legally seize this payment or not. If you have questions about your stimulus money, an attorney may be able to help you understand your rights to the funds.