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If you have been struggling to repay your debt, you may be dealing with harassing phone calls, emails, and letters from credit collection agencies. You may be concerned that debt collectors will try to garnish your wages in an attempt to recoup the debt that you owe them — or wage garnishment may already be in progress. You may be wondering if there’s anything that you can do to stop the persistent contact attempts from collection agencies. Fortunately, you have some options.
If you are having a difficult time paying your bills and are concerned about what steps creditors may pursue next, you may want to consider filing for bankruptcy. Though filing for bankruptcy may seem scary or extreme, the process is set up to help individuals achieve a fresh start when it comes to their financial obligations. Filing for bankruptcy can help stop the frequent and frustrating contact from collection agencies, and it gives you a chance to get back on your feet without constant harassment from creditors and debt collection agencies.
If you are thinking that filing for bankruptcy might be the right choice for you and your family, contact an experienced Florida bankruptcy attorney at Hoskins, Turco, Lloyd & Lloyd. During your free consultation, one of our attorneys will look at the specifics of your case and work with you to develop a plan of attack that will help you to make the best decisions possible for your financial future.
Wage garnishment is a legal procedure where a person’s employers are required to withhold a portion of the employee’s earnings in order for the employee to pay back debt. Although your employers are not allowed to dismiss you due to the wage garnishment, having a portion of your paycheck taken from you each pay period can have a huge effect on your life.
Most creditors will not be able to garnish your wages without going through a legal proceeding first. They would do this by suing you in court and being granted a money judgment. Some debt is exempt from this process, like student loans, back taxes, or child support — all of which can achieve wage garnishment without a court order — but most other debt, including credit card balances, would require the creditor to file a complaint against you and win.
Once the creditor has procured the money judgement, it can get a court order to garnish your wages. The order is forwarded to your employer, who then reserves some of the money from your paycheck each pay period and sends it to the creditor. This continues until you have fulfilled your financial obligation to the creditor.
If your wages are being garnished and it is negatively impacting the ability to provide for yourself and your family, filing for bankruptcy is one option you have to end wage garnishment. In fact, due to an automatic stay, as soon as your file for bankruptcy, all collection attempts from debt collection agencies must cease.
One right you have as a consumer is to request that creditors cease their attempts to contact you, though you will still be responsible for the debt that you owe. Even if creditors stop contacting you, they are generally still able to pursue the collection of the debt, which means that they ultimately may file a lawsuit in order for the debt to be repaid.
However, once you’ve filed for bankruptcy, either Chapter 7 or Chapter 13, an automatic stay is immediately enacted. An automatic stay requires creditors to cease their attempts at contacting you and collecting their debt as soon as they are notified about the bankruptcy filing. Not only are collection agencies no longer allowed to contact you, but all recollection attempts must also cease.
After filing for bankruptcy and receiving the automatic stay, any wage garnishment must immediately stop. If you have lost a lawsuit and a creditor has been able to garnish your wages, that must cease as soon as the creditor has been notified of your bankruptcy status.
If you have fallen behind on your mortgage and are worried about your home going into foreclosure, the automatic stay that you are granted at the time of your bankruptcy filing could protect your house from any foreclosure proceedings. However, if your house has already been sold through foreclosure at an auction, filing for bankruptcy won’t allow you to get your house back once it’s been lost. It can only help stop you from losing it before formal foreclosure actions have been taken.
If you have fallen behind on your car payments and are concerned that the bank may try to repossess your vehicle, the automatic stay means that the bank may no longer proceed with any repossession attempts until the bankruptcy proceedings are complete. It is important to note that once your vehicle has already been repossessed, bankruptcy proceedings won’t help you get it back. For this reason, it is important to contact an experienced bankruptcy attorney and consider filing for bankruptcy before the lender takes action.
Once you have filed for bankruptcy, you will need to give the court a list of all your creditors and their addresses. The court will then notify all of your creditors about your bankruptcy filing. Once the creditors have received notice, they are required to take the steps to suspend the garnishment.
If you are under any time constraints, you may want to have your bankruptcy attorney forward the filing directly to the creditor. This is a faster and more direct way to communicate this information if the wage garnishment is scheduled to begin soon.
The automatic stay you were granted when you first filed for bankruptcy ends when your case ends. If your bankruptcy discharges the debt you owed, then creditors will no longer be able to garnish your wages for that discharged debt.
However, if your bankruptcy case is dismissed, or the particular debt for which your wages were being garnished was not discharged, then you will still owe the money after bankruptcy ends, and the creditor can begin to garnish your wages again.
Contact an experienced bankruptcy attorney in Florida to discuss your options when it comes to bankruptcy and wage garnishment.
If you are thinking about filing for bankruptcy or are looking for help with wage garnishment, call the law offices of Hoskins, Turco, Lloyd & Lloyd. Our experienced attorneys have been serving the Treasure Coast for over 35 years, with offices located in Vero Beach, Port St. Lucie, Okeechobee, and Fort Pierce.
When you contact us, one of our experienced bankruptcy attorneys will meet with you for a free virtual or in-person consultation. During this consultation, we will work to help educate you about your options so that you can make the best decision for yourself and your family. Contact us today by calling 866-460-1990 or visiting us online to schedule your complimentary consultation.
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