Capital One can sue you over unpaid debt, but your SSDI payments have legal protections that limit what they can take

If Capital One has filed a lawsuit against you in Nebraska, the court can issue a judgment that allows them to garnish your bank account or wages. However, Social Security Disability Insurance (SSDI) payments themselves cannot be garnished to pay credit card debt. The law protects SSDI funds in your bank account up to a certain amount, and this protection applies even after a judgment.

The real risk is not your SSDI check—it is your other income, your bank account balance above the protected amount, and your ability to work. Understanding what Capital One can and cannot do, and what happens if you ignore the lawsuit, will help you decide whether to respond in court.

Key Takeaways

  • SSDI payments in your bank account are protected from garnishment for credit card debt under federal law, but only up to two months' worth of payments.
  • Capital One can garnish your wages, tax refunds, and non-SSDI money in your account if they win a judgment and follow Nebraska's garnishment process.
  • If you do not respond to the lawsuit, Capital One can win by default and move straight to garnishment without proving you owe the debt.
  • Nebraska allows you to claim a wage exemption in court, which can protect a portion of your paycheck even after judgment.
  • Responding to the lawsuit in writing, even if you cannot afford a lawyer, keeps Capital One from winning automatically and may give you time to negotiate.

How SSDI is protected from credit card garnishment

Federal law treats SSDI differently from other income when it comes to debt collection. SSDI cannot be garnished for credit card debt, medical bills, or most other unsecured debts. This protection is absolute—Capital One cannot take your SSDI check directly from Social Security, and they cannot take SSDI funds that are in your bank account, with one important limit.

The protection covers two months' worth of your SSDI payments in your bank account. If you receive $1,200 per month, the first $2,400 in your account is protected. Anything above that amount can be garnished. The protection applies only to SSDI—not to Supplemental Security Income (SSI), which has different rules, and not to other money in the same account.

To claim this protection, you must tell the court or the bank in writing that the money is SSDI. If you do not, the bank may freeze your account and turn the money over to Capital One. The bank is not required to know which deposits are SSDI and which are not.

What Capital One can garnish if they win the lawsuit

Once Capital One obtains a judgment in Nebraska district court, they can pursue garnishment through a process called a writ of garnishment. This is a court order sent to your employer, bank, or other entity holding your money, instructing them to turn over funds to pay the judgment.

Capital One can garnish your wages, tax refunds, and money in your bank account (except for the protected SSDI amount). They cannot garnish your SSDI check itself or the protected portion of SSDI in your account. Nebraska law allows you to keep a portion of your wages—the amount depends on your income level and family size—but this exemption must be claimed in court, either before or after judgment.

If you have other income besides SSDI, such as part-time work or a pension, that income can be garnished. Tax refunds can also be intercepted and applied to the judgment.

What happens if you do not respond to the lawsuit

If Capital One serves you with a summons and complaint and you do not file a written response within the important date (usually 20 days in Nebraska), the court can enter a default judgment against you. This means the judge rules in Capital One's favor without hearing your side of the case.

A default judgment is just as enforceable as one won at trial. Capital One can then move directly to garnishment without proving you owe the debt. They do not have to show the original contract, the charges, or that they own the debt. The only way to undo a default judgment is to file a motion to set it aside, which requires showing the court a good reason for missing the important date and that you have a defense to the debt.

Responding to the lawsuit does not mean you have to go to court or hire a lawyer. You can file a written answer yourself, stating whether you admit or deny each claim. This keeps the case open and gives you time to explore other options, such as negotiating a settlement or learning whether Capital One can prove the debt is actually yours.

Responding to the lawsuit in Nebraska

To respond, you must file a document called an answer with the Nebraska district court in the county where the lawsuit was filed. The answer should be filed within 20 days of being served with the summons. You can file it yourself without a lawyer, though the court clerk cannot tell you what to write.

In your answer, you admit or deny each claim in Capital One's complaint. You can also raise defenses—for example, that the debt is too old under Nebraska's statute of limitations (four years for written contracts), that you already paid it, or that Capital One cannot prove they own the debt. You do not have to prove your defense at this stage; you only have to state it.

File the answer with the court and serve a copy on Capital One's lawyer (the address is in the summons). Keep a copy for yourself. Filing an answer does not settle the case, but it stops the default judgment and may open the door to negotiation or discovery, where you can ask Capital One to prove the debt.

Protecting your wages and bank account

Nebraska law allows you to claim a wage exemption that protects part of your paycheck from garnishment. The amount depends on your income and family size. If you earn less than a certain threshold, more of your wages are protected. You can claim this exemption by filing a form with the court or by providing it to your employer when they receive the garnishment order.

For your bank account, the key is to keep SSDI separate from other money if possible. Deposit your SSDI into one account and other income into another. This makes it easier to prove which funds are protected. If you receive a notice that your account has been frozen, respond when ready in writing, claiming the SSDI exemption and providing proof of the deposits (bank statements showing the SSDI deposit dates and amounts).

If you have other income or savings, consider whether negotiating a settlement with Capital One might cost less than ongoing garnishment. Many debt collectors will accept a lump sum or payment plan that is less than the full judgment, especially if you can show financial hardship.

What to do if you cannot afford a lawyer

Nebraska Legal Services and other legal aid organizations may represent you for free if your income is low enough. Contact your local legal aid office to ask about representation in debt collection cases. Even if they cannot take your case, they can often explain your options and help you file an answer yourself.

The Nebraska State Bar Association has a lawyer referral service, and some lawyers offer free initial consultations. A lawyer can review Capital One's complaint, advise you on whether they can prove the debt, and represent you in court or in settlement negotiations. The cost of a lawyer may be worth it if the judgment is large or if you have significant wages or assets to protect.

If you cannot afford a lawyer and legal aid cannot help, you can still file an answer yourself. The court clerk's office can tell you where to file and what forms to use, though they cannot give legal information. Many people successfully defend themselves in debt collection cases by raising valid defenses or by negotiating settlements.

Frequently Asked Questions

Can Capital One take my SSDI check directly from Social Security?

No. SSDI cannot be garnished for credit card debt. Capital One can only garnish SSDI money that is in your bank account, and only the amount above two months' worth of payments. The rest is protected by federal law.

What if I already have a judgment against me and Capital One is garnishing my account?

You can still file a motion in court claiming the SSDI exemption and asking the court to stop the garnishment of protected funds. Provide bank statements showing when the SSDI deposits arrived. If the bank froze your account, respond in writing when ready to claim the exemption.

Does responding to the lawsuit mean I have to go to court?

Not necessarily. Filing an answer keeps the case open and may lead to settlement negotiations or discovery. You may never have to appear in court if Capital One agrees to settle or if the case is resolved through written motions.

Can Capital One garnish my tax refund?

Yes. Tax refunds are not protected like SSDI payments. If you have a judgment against you, Capital One can request that your refund be intercepted and applied to the debt. However, if part of your refund is from the Earned Income Tax Credit, that portion may have some protection.

What is the important date to respond to the lawsuit?

In Nebraska, you usually have 20 days from the date you are served with the summons to file an answer. If you miss this important date, Capital One can ask the court for a default judgment. If that happens, you can still file a motion to set it aside, but you must act quickly.