Creditors can be ruthless if you have debt and are behind on your payments. Their tactics for collection may include threatening letters and harassing phone calls. They may accuse you of being lazy and irresponsible. All of these things can make a bad situation even more stressful.
An experienced bankruptcy attorney knows exactly how to handle these situations and creditors, but unfortunately, if you do not have the funds to pay these creditors, they can take your money before you ever get paid.
What is Wage Garnishment?
Wage garnishment is something that most of us never want to think about. It is the legal right for a creditor to deduct a portion of your paycheck from your employer before you ever receive your pay. If your creditors seek this option, they will have to obtain a court order that will be given to your employer. Your employer will then notify you of the changes that will be made to your paycheck. Some debts, including child support, student loans, and back taxes are automatically eligible for wage garnishment and do not need a court order.
How Much of My Paycheck can They Take?
Once a creditor obtains a court order, they can take up to 25% of your paycheck after standard deductions. Those agencies that are not required to get a court order to garnish your wages can take up to 60% of your paycheck if the garnishment is for child support or alimony if you are not supporting a spouse or child. For back taxes, the amount that can be garnished is based upon the amount of dependents you have and the amount of back taxes you owe. Student loan debts can only garnish 15 percent of your paycheck but are not required to get a court order to do so.
What is an Automatic Stay?
Wage garnishment certainly does very little for the person whose income is being taken and can actually force you into further debt as you struggle to make do with what is left of your paycheck. Fortunately, there are laws to help protect you from this endless cycle of debt.
An automatic stay is a court order that prevents debt collectors from garnishing your paycheck. Not only will an automatic stay protect you from wage garnishment, but it will protect you from other legal actions involving your finances. An automatic stay can keep your utilities from being disconnected, stop you from being evicted from your home, and prevent foreclosure of your home.
Contact an Experienced Bankruptcy Attorney Today
There are a lot of misconceptions when it comes to bankruptcy and it is often something most people consider as a last resort. While bankruptcy should not be taken lightly, it can often be the best option to stop the debt cycle and get back on your feet financially. Two types of bankruptcy can stop wage garnishment, and the attorneys at Lankford & Moore Law can help you understand your legal options. Contact us today to schedule a consultation and let us help you get back on even ground financially.