Minnesota House Bill HF3188

Minnesota 2025-2026 Regular Session

• Introduced: 4/21/25
• Refer: 4/21/25

Caption

Garnishment and bankruptcy exemptions modified.

Impact

The proposed changes brought forth by HF3188 signify a shift in how garnishment laws are applied, specifically regarding the protection of small amounts of cash in banking accounts. By enabling debtors to safeguard a modest sum from creditors, the bill aims to alleviate some of the financial stress associated with debt collection. This can significantly impact low-income individuals who might find themselves in precarious financial situations. The introduction of this exemption is set to take effect on August 1, 2025, indicating that these protections will be forthcoming but are contingent on successful legislative processes.

Summary

House Bill HF3188 aims to modify existing laws related to garnishment and bankruptcy exemptions in the state of Minnesota. The bill seeks to amend various sections of the Minnesota Statutes, including those pertaining to the amount of money that can be exempted from garnishment when a debtor faces legal action for outstanding debts. Notably, the bill introduces a specific exemption for funds in a debtor's depository account, allowing up to $1,000 to be protected from garnishment, thereby providing greater financial security for individuals with limited resources.

Contention

While the bill is likely to be favorable for those struggling with debt, it may also spark discussion about its implications for creditors and financial institutions. Critics may argue that such exemptions could hinder the recovery of debts owed, potentially complicating the processes creditors rely on to collect on judgments. Supporters of the bill, however, advocate that protecting small amounts of money is a necessary step in ensuring that debtors can meet basic living expenses without the risk of immediate financial ruin. Overall, such legislative changes will need to be carefully evaluated for their broader economic implications.