I've been doing personal injury work a long time and haven't heard of creditors garnishing personal injury settlements before they get to a client. A debt collection lawyer may know otherwise. I'll change the practice area to that.
I am not your lawyer unless we enter into an engagement agreement in writing. This is general information that is given for legal education only. It is not legal advice, and it may not work for your specific situation. I strongly encourage you to consult with a local lawyer to get legal advice and help with your specific situation at your earliest convenience. I am licensed to practice law in Arizona.
Generally, Arizona prohibits the third party assignment of personal injury claims. That means, generally speaking, creditors are unable to assert claims over settlement funds. The only exceptions to this are allowed for in state statutes or federal regulations, and include healthcare providers and health insurers.
However, bank accounts can be garnished, and upon depositing the funds in a bank account, those funds may be frozen and garnished by the creditor. But I would not think that the creditor would have any standing to garnish the funds BEFORE they are tendered to you. Once they are deposited, they may be subject to garnishment.
Disclaimer: This post is for informational purposes only, and is not intended to provide legal advice or establish an attorney/client relationship. Legal advice should obtained by discussing the specific facts of your case with an attorney licensed to practice in your area.
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