For people already struggling with debt problems, having a paycheck garnished is a killer. It can mean not having enough money to make necessary living expenses. Like the rent or mortgage payment. Or the car payment. Or the electric, gas or water bill. Or to buy groceries or medicine.
These people want to know one thing. Will filing bankruptcy stop or prevent their paycheck from being garnished?
In most cases the answer is yes. You see, the second a bankruptcy petition is filed, an automatic stay goes into effect. And this automatic stay prohibits a creditor from taking any further collection activity without the permission of the bankruptcy judge. If the garnishment has not begun before your bankruptcy case is filed, then the bankruptcy will prevent the garnishment from beginning at all. If the garnishment starts before your bankruptcy case is filed, then the garnishment will stop immediately after your case is filed.
The automatic stay stops or prevents the vast majority of wage garnishments except for a few exceptions such as for child-support or other court-ordered domestic support obligations.
And what’s more, if a creditor has taken over $600 from your paycheck or your bank account within the 90 days before you file bankruptcy, then upon notice of the bankruptcy filing the creditor must immediately give back every penny of the money they took.
If your wages are being garnished or are about to be garnished and you would like to know more about how bankruptcy may be able to help you, contact me today by phone or email to schedule a FREE initial consultation. I would count it a privilege to be able to visit with you in a relaxed and confidential environment where I’ll answer all of your questions in plain English and give you the straight scoop on the pros and cons of bankruptcy as related to your specific situation.