Stop Wage Garnishment
How to Stop Wage Garnishment
What is Wage Garnishment?
A creditor, or someone you owe money to, can have an attorney file a motion with the court to force your employer to deduct a certain amount from your paycheck in order to pay your debt to them. The process of deducting this from your pay is known as a wage garnishment.
A wage garnishment can be devastating to an individual or family and often makes an already bad financial situation much worse.
How Does Wage Garnishment Happen?
The majority of wage garnishments begin when a creditor, such as a credit card company or a bank, files a lawsuit against a client for nonpayment. Banks that sue homeowners following a foreclosure are included in this category. They receive a judgment against the individual if they win in court. As a result of the ruling, they are now able to get a garnishment order. The person’s employer receives the court order.
Will Filing Bankruptcy Stop Wage Garnishment?
Generally, filing bankruptcy will stop your wage garnishment. If you are already behind in payments to a creditor or have a pending lawsuit, a garnishment is very possibly the next step, and it may be in your best interest to file bankruptcy sooner rather than later in order to prevent that creditor from garnishing the money you need to pay your bills and put food on the table.
Does Someone Have to Notify You Before Garnishing Wages?
Prior to getting your wages garnished, you should have received several things in the mail. First and foremost, a creditor would have filed a lawsuit against you. Again, a filed judgment is not required for owed child support, student loans, or taxes. Having a judgment filed against you does not automatically mean they will garnish your wages and you often have some time before you have to take action. Other things that could happen include a bank levy or judgment lien filed on your property.
Your wages will not be garnished without warning. You and your employer will both get notice before they are deducted. The paperwork you will receive in the mail will include the phrase “Order of Wage Garnishment.” If you receive this paper and have not made steps toward filing bankruptcy, it is now time to take action. You should be able to file before it starts and avoid it all together.
How Much Money Can Be Garnished From Your Paycheck?
The intent of a wage garnishment is to pay off the entire debt. An amount of about 25% of your paycheck will be taken out each time and sent to the creditor until the debt is paid. However, be aware that the percentage of pay to repay child support, student loans, or taxes could be higher.
How to Stop Wage Garnishment?
A wage garnishment will continue until the entire debt is paid off or arrangements are made to pay off the debt. If you do not want to file bankruptcy, your only other options are continuing with the garnishment or contacting the creditor directly to arrange payments for the debt.
Filing a chapter 7 or a chapter 13 bankruptcy can put an end to your wage garnishment. Once you file and have a case number, creditors will no longer legally be able to pursue you. In a chapter 13, you will pay back your creditors, including the one trying to garnish you, with plan payments. In a chapter 7 bankruptcy, as long as the debt is dischargeable, they can take no further action against you.
Your Louisville bankruptcy attorney will send notice to the creditor and their attorney to get the wage garnishment stopped immediately and recover some of the funds that may have been taken.
How to Stop Wage Garnishment Before It Starts
A judgment is required before a creditor or collection agency may obtain a garnishment order. To put it another way, they need to win the lawsuit. Now, fighting the lawsuit isn’t always a smart idea (after all, unless the debt you’re being sued for isn’t yours, there’s rarely a strong defense), but that doesn’t mean you should ignore it.
Also consider speaking with an attorney who offers credit counseling. At O’Bryan Law Offices, we’ll evaluate your financial situation and recommend how to stop wage garnishment for your situation. We’ll also assist you with putting together a repayment plan to offer the bank, if applicable.
If you do (ignore the case), you will just hasten the inevitable. If the creditor hasn’t heard from you in a long time, they might seek the court to issue a default judgment against you. This is known as a default judgment, and it’s similar to forfeiting a softball game because your team didn’t show up.
Is There a Chance of Getting Garnished Wages Back?
If you have been garnished before you file for bankruptcy, it is possible to get some of your garnished wages back. Funds in excess of $600 taken within the ninety days prior to filing can be recovered. Any amount that is taken after the filing date can also be recovered. Usually a refund check will be sent to your attorney for you to pick up.
Benefits of the Automatic Stay
Not only does the automatic stay interrupt standard collection calls and letters, it also covers such other actions as the following:
- Any lawsuit against a debtor in bankruptcy
- Garnishment, attachment, repossession or other collection strategies
- Mortgage foreclosure
- Enforcement of judgments or liens
There are a few exceptions to the automatic stay that generally have to do with child support and alimony obligations. Under some circumstances, a creditor can also ask the bankruptcy court for permission – relief from the automatic stay – to resume collection efforts. These are most common when the creditor’s claim is supported by an interest in collateral. We can negotiate with the creditor to protect your interests in these situations.
Contact O'Bryan Law Offices to Find Out How to Stop Wage Garnishments
Don’t wait for that garnishment to start. Call today to schedule your free Bankruptcy consultation with one of our experienced Louisville Bankruptcy attorneys. At O’Bryan Law Offices, we have helped thousands of individuals and families file Chapter 7 and Chapter 13 Bankruptcies. We will help you understand your options and determine which chapter of Bankruptcy is right for you. Our clients have dealt with many of life’s challenges, resulting in overwhelming debt. They chose to address their debt head on and give themselves the fresh start they deserve.
If you are interested in learning about your options through Bankruptcy, make an appointment to speak with one of the experienced Bankruptcy attorneys at O’Bryan Law Offices today. We now offer free “Life After Bankruptcy” courses to our clients to help them rebuild their credit score. Call us today at 502-400-4020 for a free Bankruptcy consultation. Get a fresh start and stop wage garnishment today.