What is a bank levy and how does it work for collecting an unpaid invoice?

A bank levy is one of the fastest post-judgment collection tools. After winning a judgment in court, the creditor obtains a writ of execution (or writ of garnishment, depending on the state) from the court clerk, then serves it on the debtor's bank. The bank is legally required to freeze the account and remit available funds to the levying officer or directly to the court for distribution to the creditor.

State law determines what funds are exempt from levy. Social Security benefits, certain pension and retirement funds, and a minimum balance (the exact amount varies by state) are often protected. If the account balance is entirely exempt, the levy returns nothing. This is why identifying which account to levy — and whether it holds non-exempt funds — matters before executing.

Finding the right bank requires either cooperation from the debtor, a post-judgment debtor examination (where the debtor is compelled under oath to disclose bank accounts), or a bank search service. Many judgment creditors skip this step and wonder why their levy returns empty.

Unlike wage garnishment, which delivers money over time through paycheck deductions, a bank levy seizes whatever is in the account on the day the writ is served. If the debtor moves funds before service, the levy returns nothing — timing matters.