A new law for unemployment in Wisconsin?

Can the bank take my unemployment for a defaulted loan?

• My husband had a loan through a bank in our home state of Wisconsin for a vehicle. We seperated and he stopped making the payments. It ended up being repossessed and even after being sold he still owed the bank on the loan. I understand my name is on it and I'm also responsible, my question lies in the legality of what the bank has done. When we seperated I got my own checking account at the same bank. I got quite a shock this past December when my unemployment checks started being taken. I contacted the bank and they said the balance went to debt collection and they were taking my money. They took every check I had in December and I almost got kicked out of my apartment. The bank said they tried to notify my spouse multiple times with no answer. Alot of good that did me since we dont speak. Now looking into the laws it seems that any state or federal benefits are exempt from debt collection, which my unemployment would fall under. How is the bank able to get around that or are they breaking the law? I accept my responsibilty for my name being on it and would have made arrangements, but they way they have gone about this has left me in a very bad spot. Do I have a case against them or are they within the law?

• Answer:

  It's perfectly legal. It's called cross collateralization and you agreed to it when you opened the bank account and signed the loan documents. This means they can pull funds from any account with your name on it to pay defaulted accounts. Makes no difference the source of the funds. The bank would not be able to garnish your unemployment check, even if they had a judgment. But once you deposited the checks in the bank account, it was fair game. Open a bank account at a different bank. They won't be able to take the funds from an account in a different bank.