Wage garnishment occurs when a judgment creditor obtains a court order authorizing your employer to withhold and send a certain percentage of your wages to satisfy a debt. If a creditor wins a money judgment against you, and you subsequently don’t resolve the debt proactively, the creditor can obtain a garnishment writ which essentially takes money directly from your paycheck. To many people, wage garnishment is a very intimidating phenomenon, and something they’d like to avoid whenever possible. If you receive notice that you will be subject to a wage garnishment order, you need to know that you have options to deal with this problem. Here are a few options for stopping a garnishment.

1. File a Claim of Exemption

One option you have is to file something referred to as a “claim of exemption.” An exemption basically allows you to protect a certain portion of your wages and shield it from garnishment. Your wages are protected at the federal level – creditors cannot garnish more than 25% of your “disposable earnings” – but state level exemptions can help to protect even more of your income. The State of Florida has its own garnishment exemptions which you can invoke under different circumstances. You could qualify for exemption from garnishment if you are head of household providing support to a dependent child, or if your only income is from social security or disability income. There are other financial categories that also may qualify you for exemption from garnishment. Still, it is important to note that a claim of exemption won’t necessarily eliminate a garnishment but it may lessen the amount eligible for withholding for a creditor.

2. File Chapter 7 or Chapter 13

Another method you can use to stop a wage garnishment is file either Chapter 7 or Chapter 13 bankruptcy. In a Chapter 7 case, you’ll receive an automatic stay, which temporarily stops a garnishment while the case is handled. Then, if the debt is eligible for discharge, the garnishment will be eliminated if the discharge is granted. In a Chapter 13 case, you will also receive an automatic stay, but the underlying debt will need to be restructured in a payment plan. This means that you will need to find a way to arrange for payment, but according to a plan which is suitable to your situation. In either case, you can effectively defeat a garnishment with a bankruptcy.

3. Quit / Change Jobs

This may not be the most practicable solution for many people, but remember that you can stop a wage garnishment by simply leaving your employer. Your wage garnishment can only take effect if the creditor (and the local authorities) knows your place of employment. If a creditor finds your place of employment, you can at least temporarily stop a garnishment by gaining employment elsewhere. Of course, the garnishment can resurface as soon as your new employment is discovered. But this can momentarily stop the garnishment for a certain period of time.

4. Post-Judgment Settlement

Many people think that a money judgment obtained in court isn’t subject to settlement any longer. This is definitely not the case. A money judgment obtained in court simply means that a judge (and the court) officially recognizes the debt and can authorize certain actions to recover the debt. In reality, the creditor still has the burden of collecting the money. This is why many people are considered “judgment-proof,” because they lack the means to satisfy the debt. Given that the creditor has the burden to collect, many creditors are willing to enter a post-judgment settlement, which means that they will negotiate a payoff of the debt for below its face value. If a person faces a garnishment, this can be one method to stop it, because the creditor may be willing to accept a lump sum which is lower than the current total owed.

Contact Financial Freedom Advocates for More Information

If you’d like to learn more, or need assistance, contact Financial Freedom Advocates today by calling 786-668-6688.