Garnishments, Bankruptcy & What You Need to Know

drawing of world in half with money coming out from the middleIf you have been sued by a creditor  who obtained a judgment against you, it is likely a garnishment has been (or will be) filed against you. A garnishment is a tool used by creditors to collect the money awarded in a judgment. A creditor can either file a garnishment against your bank accounts or against your paycheck.

How do garnishments work? Once a creditor has a judgment against you, the creditor can serve a writ of garnishment on  your bank or your employer.  Unless you successfully claim an exemption, if your bank is served with a garnishment and there are funds in your account, the funds will be taken from your account and given to your creditor.  If your employer is served with a continuing writ of garnishment against your salary or wages, unless you successfully claim a head of family wage exemption, 25% of your disposable earnings each paycheck will be given to your creditor until the creditor’s debt is satisfied.

There are some income sources that cannot be garnished, such as social security benefits,  disability benefits, unemployment benefits, and workers’ compensation awards.

If  a garnishment has been filed against you, it is time to consider filing for bankruptcy protection. The automatic stay is effective as soon as you file your bankruptcy petition and it prohibits any further collection activity against you. Since garnishments are a form of collection, they must stop. Your account or paycheck will no longer be garnished and you may be able to discharge or eliminate the debt linked to the garnishment.

Please keep in mind that every case is different. If a judgment has been entered against you, and you are interested in filing a personal bankruptcy,  please contact our office to schedule a no-cost consultation by completing the form on this website or calling us at (954) 932-5377.


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