In many cases, wage garnishment is the straw that breaks the camel’s back. Individuals on the fence about filing bankruptcy are forced to when a wage garnishment is instituted.
I would argue that if it gets to the point of wage garnishment, you have already waited too long. What is this intrusive remedy? How is it instituted and what can be done to combat it?
Wage Garnishment = Access to Your Income
Quite simply, wage garnishment gives a creditor the absolute right to seize a percentage of your income each pay period. There is hardly a more invasive remedy available to creditors.
The Sheriff or Marshall will serve you with an income execution. Your failure to reply will result in the Sheriff going directly to your employer.
Your employer will be compelled by the Sheriff to turn over 10% of your gross income.
The Wage Garnishment Process
All wage garnishments start with a collection lawsuit. If the suing creditor obtains a judgment against you, they have the right to garnish your wages.
The creditor will turn the judgment over to the Sheriff or Marshall, who will in turn notify you. You will be given the opportunity to pay the debt voluntarily, but failure to do so will prompt the Sheriff to visit your employer.
A wage garnishment served on your employer is not only damaging financially, but equally embarrassing.
At this point you will have 10% of your gross income deducted and for most people, this will make it extremely difficult to meet your monthly expenses.
Stopping Wage Garnishment
This is no easy task and it is advisable to take action before it gets to this point.
If you have received a wage garnishment or are already having your wages garnished, you can attempt to vacate the judgment. A typical defense used to vacate a judgment is that you were never properly served with the original lawsuit.
Bankruptcy can be a far better remedy for handling wage garnishments. Upon filing, the automatic stay goes into effect and all creditor collection action must stop. This includes wage garnishment.
If wage garnishment is the most intrusive remedy available to creditors, the bankruptcy filing and the automatic stay are the strongest shield to protect yourself.
If you have received a collection lawsuit or are fearful of a wage garnishment, it is advisable to consult with a bankruptcy lawyer immediately to understand the ramifications and options available to you.
Image courtesy of Pearlmatic.