Wage Garnishment


Wage Garnishment:

Sometimes an individual debtor who may find that a creditor has begun taking money out of each paycheck. This can only happen after that creditor wins a judgment against the individual and cannot collect their money. Wage garnishment (sometimes called wage attachment) represents one way for a creditor to recover some of their money after winning a lawsuit against a delinquent debtor.

How Wage Garnishment Works:

Once the creditor wins a judgment, the court will forward the information to the employer. They would then begin to withhold the specified amount from each paycheck All states place limits on what percentage of the individual's salary may be taken out of each check. That amount may be reduced further with exemptions that the debtor takes.

Once that bankruptcy case is discharged because time has passed or the requirements for Chapter 7 have been met, the creditor cannot begin garnishing wages again. If the debtor's case was discharged for failure to meet their payment obligations under Chapter 13, wage garnishment can begin again.

In rare cases, garnished wages can be returned to the petitioner. You would have to check with a bankruptcy attorney to see if this is realistic in your situation under New York and federal bankruptcy law. In general, it might be possible to recover wages over $600 if those wages were taken within 90 days prior to declaring bankruptcy. An attorney would know if an individual's situation is one that makes recovering garnished wages an option.

Stopping Wage Garnishment:

Filing a Chapter 7 or 13 bankruptcy petition stops wage garnishment. Bankruptcy protection ends wage garnishment and may restore the debtor's full income. You can ensure that wage garnishments stop promptly by alerting your company payroll department as soon as you file for Chapter 7 or Chapter 13. Assuming the creditor was listed in your bankruptcy petition the company should be able to stop wage garnishments quickly.

If you have questions about wage garnishment or about another aspect of bankruptcy talk to an attorney about your situation.

QUICK CONTACT • Attorney Stephen A. Katz

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