What Should I do About a Notice of Levy?

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  • Written By: Lainie Petersen
  • Edited By: Melissa Wiley
  • Last Modified Date: 22 January 2020
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If you receive a notice of levy, be aware that a creditor intends to seize your assets in order to satisfy a debt. If you want to protect your assets, particularly if some of them are exempt from seizure, you should act quickly. Contacting an attorney is a good idea, as is taking steps to prove that some of your assets are exempt. You may also want to try negotiating with your creditor to see if you can work out an amicable payment arrangement or even open a new bank account in order to protect your funds.

Typically, a notice of levy is sent after your creditor has won a judgment against you in a court of law. However, in some places, a court judgment may not be necessary to levy your assets. For example, in the United States, a court judgment is not required to collect a tax debt, a defaulted student loan, or back child support via wage garnishment or levy. Your creditor will likely contact your bank and put a freeze on your account, which can be for more than the value of the judgment, and then begin taking what money it can from the account.


A lawyer can help you determine if you have any chance of appealing or vacating the judgment against you, so consider contacting one as soon as you receive your notice of levy. If you can't afford a lawyer, you may be able to get legal advice through a legal aid society or other legal service for low-income people in your community. In some places, some of your income or assets, such as retirement benefits or disability income, cannot be levied. If you receive such income, notify your creditor, your bank, and the court that ordered the levy of this fact. While it is probably illegal for your creditor to take these funds, the responsibility is usually on you to prove that these funds are exempt, so start making these notifications as soon as you receive the notice of levy.

Another way to protect your money is to open a new bank account. This actually accomplishes two things. First, it allows you to keep any of your exempt assets separate from assets that your creditor is free to levy. Secondly, it provides you with a safe place to keep your money until and unless your creditor learns about the other account. Another option is filing for bankruptcy. Depending on the laws where you live, bankruptcy may protect you against all collection activity, including levies.


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