When you take a look at your paycheck and realize that you are being paid less than usual, the culprit could be wage garnishment. If you owe a debt, a creditor can go to court and ask to start taking money right out of your wages. This can be inconvenient to say the least, so what’s the best way of addressing this and putting a stop to wage garnishment once and for all? A Montgomery County bankruptcy lawyer from our firm can tell you more about your options.
When Can Creditors Begin Wage Garnishment?
Creditors cannot usually begin taking money out of your paycheck right away. Wage garnishment is a method that’s used after other attempts at debt collection have failed. If you have ignored phone calls or mail about your bills and continued not to pay them, a creditor may go to court and get the right to take a portion of your wages.
There are also some types of debts that can lead to wage garnishment without the need for the courts to step in. Debts like unpaid student loans and a backlog of child support can get your paycheck garnished, even without a court order. This practice is referred to as administrative wage garnishment, or AWG for short.
Can Filing for Bankruptcy Stop Wage Garnishment?
When you file for bankruptcy, an “automatic stay” is issued. This puts a stop to all collection activities. It comes into effect whether you file for Chapter 7 or Chapter 13 bankruptcy.
When the automatic stay puts a stop to collection activities, that usually means wage garnishment has to stop as well. The creditor can try to get the court to lift the stay so that they can continue collecting the debt, but it’s not a certainty that their request will be granted.
However, you should know that certain types of debts and garnishments won’t be affected by this. If you owe child support, alimony, or student loans, these are just a few of the debts that will not be affected by bankruptcy.
What Are the Pros and Cons of Filing for Bankruptcy?
There are also some potential drawbacks of bankruptcy you should be aware of. Filing can stop many types of wage garnishment, help you get rid of debt, and allow you to get a fresh financial start. However, you also need to know that some types of debt are just not addressable during bankruptcy, no matter which chapter you file for. Bankruptcy also impacts your credit score for a long time, usually seven to ten years.
Schedule a Consultation
If you are considering filing for bankruptcy or taking other steps to deal with your debts, talk to a lawyer first. Contact Mudrick & Zucker to schedule a consultation and learn more about the bankruptcy process. If we think that it’s a good option for you, then we’ll help you get your paperwork in order.
