A creditor who cannot reach the person responsible for debt owed to create a repayment plan or if the person is delinquent on his account for any other reason, the creditor may be allowed by the courts to directly take repayment from an employer. This is known as wage garnishment. The debtor will never see money that has been garnished. It is like taxes, it automatically disappears from a paycheck. Having a paycheck cut before receiving it is emotionally stressful, and can lead to debt of other kinds.
Taking Your Check
In addition to creditors, tax authorities at the state and federal level can also garnish wages. The Consumer Credit Protection Act may limit how much of your wages may be taken. Often, wage garnishment creates a situation where living expenses and medical expenses may languish, creating a snowball of debt that is impossible to overcome on your own.
Speaking with a Fort Worth bankruptcy attorney may provide some insight on whether filing for bankruptcy could help your financial situation. From the moment you file for bankruptcy, an automatic stay is placed on your accounts and creditors will no longer be able to collect. During the course of your bankruptcy case, an attorney will help you navigate the best course of action for repaying debt or helping you discharge it.
In some cases, you may even be able to get back wages that were garnished prior to filing for bankruptcy. This is normally allowed for the 90 days prior to your filing. It is important, if your wages are being garnished, that you notify your attorney of all creditors owed. An automatic stay can only cover what is known and notifiable.