Stop Bill Collectors! » Wage garnishments

How to Stop a Garnishment Without Filing for Bankruptcy

Janice — Mon, 08 Feb 2010 15:27:19 +0000

If you have creditors who file a judgment against you for debts owed to them, your wages could be docked. While the laws on wage garnishment differ from state to state, generally once creditors have a court order against you, they can take 25 per cent from each pay check. Once a creditor has filed a judgment against you, there are very few options (besides bankruptcy) available to you. Therefore, the trick is to stop a garnishment before a creditor obtains a court order.

There are two types of claims you may be able to use to stop a garnishment.

Claim of exemption. You need to file this if you are not able to cover basic living expenses like food and housing. The form for this claim is available from your local courthouse.
Head of household exemption. This is for people whose wages support a spouse and family. If you intend to file for this exemption, you will need to write a letter and file it at your local courthouse. Not all states have a ‘head of household exemption’, so you will need to check the laws for your state of residence.

If you are not eligible to claim either of these exemptions, you can try tackling the problem by contacting your creditor directly. Call your creditor and explain your situation. Offer to pay a percentage of the debt and then ask if you can establish a fortnightly or monthly payment plan and obtain any agreement of this in writing.

Seeking advice to consolidate your debts will also help to stop a garnishment. Debt reduction programs are mainly concerned with helping you to pay back unsecured debts, like credit cards. With a debt reduction program, you agree to pay over time and the interest (and sometimes, principal) is reduced, so you pay less per month. The idea being that you pay back the debt in full over a period of three to five years. This means that your creditors are still being paid, so they won’t pursue wage garnishment.

Unfortunately, the only other way to stop a garnishment is to pay the debt in full. Making a full payment is the easiest and simplest way to stop a garnishment once it’s under way.

How to Stop Wage Garnishments Using State Laws

Janice — Fri, 11 Dec 2009 14:11:18 +0000

In general, creditors with a judgment against you can take 25% of your income, unless you owe back child support or alimony, when the state can take up to 50 percent of your disposable income. If you are in arrears, they can legally take 55 percent. And if you owe the government money: watch out. For unpaid taxes or delinquent student loans, they can take a whopping 65 percent of your disposable income. If you’ve read my general article on how to stop wage garnishments, you’ll know that once a garnishment is in place, there are very few options to stop garnishment. Some states have enacted laws to protect consumers from unfair garnishment; you might be able to stop a garnishment if you meet the requirements for that state.

Here are the state laws that allow you to fight garnishments. The best states to live in include Pennsylvania, South Carolina, and Texas, which prohibit wage garnishment for consumer debts like credit cards. By far the worst state is California, which not only allows garnishment of your wages: it also allows for garnishment of your spouses wages to pay off your debts!
If you live in one of the following states, read the exemptions. If of these apply to you, you should immediately petition the court (that ordered the garnishment) to cease garnishment, clearly stating which reason applies to your case. If you live in any other state, only the general rules for avoiding garnishments apply (see the article on avoiding wage garnishments in general):

California Wage Garnishment Exemptions

Federal laws apply. There is an exception if the garnishment came from a California Small Claims Court judgment. To stop the garnishment, file form SC106 to request payment in installments. Make the amount as small as you can: the judge has leeway with repayments. California is a community property state: your spouse’s wages can be garnished for your debts with a court order.

Florida Wage Garnishment Exemptions

The head of household exemption protects your wages up to $500 a week as long as you did not consent to the garnishment in writing. Otherwise, the current exemption is the Florida minimum wage (currently $7.21) x 30. Debtors also have a short period of time (four years for credit card companies and five years for contracts) to collect a judgment.

Missouri Wage Garnishment Exemptions

Creditors can only garnish 10 percent of your income if you are the head of a family and a Missouri resident.

New York Wage Garnishment Exemptions

Creditors can garnish 10 percent of a your gross weekly income or 25 percent of your disposable weekly income, whichever is less. Combined garnishments cannot exceed 25 percent. You must also be notified before the garnishment takes place.

North Carolina Wage Garnishment Exemptions

Garnishments for consumer debt are prohibited. Non-consumer related garnishments (like child support) can still apply.

Oregon Wage Garnishment Exemptions

Exempt wages are 40 times the current minimum hourly wage. In other words, you can work 40 hours a week at minimum wage without being garnished.

Pennsylvania Wage Garnishment Exemptions

Garnishments for consumer debt are prohibited. Non-consumer related garnishments (like child support) can still apply. Warning: if you deposit your paycheck into a bank account, they may be able to take that money through a bank account garnishment.

South Carolina Wage Garnishment Exemptions

Garnishments for consumer debt are prohibited. Non-consumer related garnishments (like child support) can still apply.

Texas Wage Garnishment Exemptions

Garnishments for consumer debt are prohibited. Non-consumer related garnishments (like child support) can still apply.

All other states

Federal exemptions apply.

How to Stop Wage Garnishments Without Filing for Bankruptcy

Janice — Mon, 07 Dec 2009 19:15:36 +0000

Wage garnishments are an unfortunate consequence of having a judgment entered against you in court. You may not even know of the existence of a garnishment until you get a notice in the mail informing you that your next weekly check is going to be docked. In order to stop the garnishment without filing for bankruptcy, you’re going to need to do a little research and some legwork.

How to stop wage garnishment in four easy steps:

Research the laws applicable in your state. You can find information on state exemptions for garnishments in this article. This step is vital: your creditor has to follow the steps so in order to defeat them you must arm yourself with information. Call a lawyer offering a “free consultation” (usually a bankruptcy lawyer) and take advantage of that. Go with a list of questions, tell the lawyer you are “considering” bankruptcy, and pick their brains for other options that may be applicable to your state. For example, did you know that in Florida, there’s a Head of Household exemption that protects low income earners with families?
File an objection with the court against a pending garnishment. Explain to the judge the specific reasons why your wage garnishment should be denied. Be specific, and use the knowledge you gained in Step 1. If the garnishment will leave you without enough money to pay your basic bills, say so in the letter. Most states allow judges to quash garnishments if it leaves a person unable to provide themselves and their families with enough money to purchase food, clothing, housing, and other basic necessities.
Call your creditor if you don’t think you have a case to stop the garnishment. Tell a white lie and explain (nicely!) that you will be fighting the garnishment in court (the creditors won’t like this, because that costs them time and money). Further explain that you are willing and able to pay x amount of dollars. Make this pitifully small. Negotiate to find the low point that your creditor is willing to work with. The important thing to realize at this point is that once the court is garnishing your paycheck, there is little to nothing you can do to stop it outside of bankruptcy. You have to negotiate down at this point, because otherwise they will take your paycheck.
If you come to an agreement with the creditor, file a copy of that agreement, as you understand it, with the court. If some mistake is made, the first thing the judge will see when he opens your case is that letter.