Depending on the state of residency, a collection agency may have the right to freeze a bank account and take assets from that account per a court order according to the Consumer Financial Protection Agency. The court's judgment will state the amount of money owed, and there will be a determination made on how much of the funds will be taken.
However, there is some protection available to funds that are received from federal assistance — such as social security, disability and unemployment wages — although everything else is fair game. The debtor will be left with some money to live off of, but it is less than previously counted on. If a credit user is having trouble repaying a debt and has been getting phone calls from collectors stating they will freeze your assets or garnish your wages, they shouldn't ignore them. Try to work out a repayment plan. Seeking the help of debt counselors to get spending and budgeting on track is also a good idea. In the event of a lawsuit, consult an attorney and discuss options. Try not to wait until a judgment has already been issued. It is much more costly and harder to reverse a garnishment order once a judge has already made a decision.