Stop Wage Garnishment with Bankruptcy
If your wages are being garnished by creditors, you may be able to stop them by filing for bankruptcy. In fact, you may even be able to recoup already-garnished wages through a bankruptcy filing. As always, exceptions apply. Follow this easy guide to understanding wage garnishments and bankruptcy.
Bankruptcy & the Automatic Stay
As soon as you file for bankruptcy, an automatic stay takes effect which means most creditors need to stop collection efforts immediately. The automatic stay normally includes a halt on wage garnishments. A creditor can petition the court to lift the stay, but this request will only be granted under certain circumstances.
The automatic stay does not stop collection efforts on child support or alimony, as these are considered priority debts, and not erased by filing for bankruptcy. So, if your wages are being garnished to pay for child support or alimony, the automatic stay will not apply to these collection efforts.
Wage Garnishment Before Bankruptcy
Under certain conditions, you may be able to recoup previously-garnished wages upon filing for bankruptcy. Typically, wages garnished within 90 days prior to your filing that amount to $600.00 or more can be returned to you, as long as you have adequate exemptions to cover them. However, it is important to do the math on whether it makes financial sense to take this course of action considering the additional attorney fees you may incur.
Get Wage Garnishments Stopped Immediately
Though filing for bankruptcy immediately puts an automatic stay in place on all collection efforts, your wages may continue to be garnished until all creditors have been notified. To get wage garnishment stopped immediately, notify the payroll department at your place of employment of your bankruptcy. Because wage garnishment typically happens through the local sheriff’s office, notify them as well.
With 23 years of experience, the team of attorneys at Burr Law Office are here to help you make the best decision about filing for bankruptcy. Give us a call today: (262) 827-0375!