Subcommittee approves bill to automatically protect $500 in bank accounts from garnishment

Delegate Hernandez introduced House Bill 1864 as a consumer-protection measure to make certain bank-account exemptions self-executing. Under the substitute presented to the committee, the bill would automatically protect $500 in a depositor—s bank or credit-union account from garnishment without the account holder having to go to court or hire an attorney. The substitute also contains an inflation adjustment modeled on the existing poor-debtors statute.

Why it matters: supporters said the procedural change closes a gap where people who are eligible for exemptions may lose access because they lack counsel or do not know how to assert an exemption, and that automated protection prevents immediate loss of funds needed for necessities.

Support and stakeholder engagement: testimony in favor came from Jay Spear of the Virginia Poverty Law Center and representatives of financial-industry groups, including Matt Breiding of the Virginia Bankers Association, Corey Connors of the Virginia Association of Community Banks, Jared Calvi of AARP Virginia and Matt Benedetti representing a creditors' bar association. Committee members confirmed that treasurers and other stakeholders had been consulted during drafting.

Committee action: the committee adopted the substitute and reported HB 1864 by recorded vote, 6–0. Committee discussion and the submitted substitute focus on process and automation rather than altering total exemption amounts under state or federal law.

Next steps: HB 1864 will move forward from the subcommittee in the legislative process. Advocates and financial institutions asked for continued engagement on implementation details, including how treasurers and financial institutions operationalize the automatic protection.