Upon the filing of a Chapter 7 or a Chapter 13, creditors cannot make any collections, which is how bankruptcy acts to stop garnishments. A wage garnishment is a way that money may be collected by that creditor that has a judgment already. This means that if you are at the stage of garnishment, a judge has already issued a judgment against you, as you have already been previously sued.
How Much Can Be Garnished By A Judgment Creditor?
After a judgment against you has been gained by a creditor, under the law in Georgia, they may be able to garnish your bank account or your wages in the following ways:
- Each and every pay period, 25% of your pay check can be garnished by creditors.
- Your savings and checking accounts may also be garnished by your creditors, and unlimited amounts of your money in your bank accounts taken to satisfy debts to them, up to the judgment amount.
To Stop A Garnishment, How Does Bankruptcy Help?
A protection by the court called the “automatic stay” is initiated when bankruptcy is filed. To all creditor actions the stay applies, including garnishments. The garnishment process immediately stops when a bankruptcy is filed. When attorney Matthew C. Hines is hired by debtors to halt a garnishment, as quickly as possible he files the bankruptcy and immediately notifies the creditor that is conducting the garnishing of the bankruptcy filing.
To Stop A Garnishment, When Should I File Bankruptcy?
After receiving notice of the garnishment, as quickly as you possibly can, you should file bankruptcy. The garnishment is served upon the employer or the bank in the state of Georgia, and within 30 days of being served, the garnishment answered by the employer/bank, and money withheld to be sent to the court. Thus, before the money is sent to the court, you want to file your bankruptcy case.
Of The Garnishment Already Started, Can I Get My Money Back?
You might not be able to get back any money already taken, if your pay check has been garnished by the creditor. There should however, be a stoppage of any future garnishment. You should make certain to notify your payroll manager, or human resource department, to make certain they know you have filed bankruptcy and to halt the garnishment.
Your bank will place a hold on your account, when a bank garnishment is filed by a creditor. The creditor’s garnishment action is required to be answered by the bank, so if before the answer is due you file bankruptcy, you might be able to halt the creditor from being able to take from your account any funds.
A Creditor Can Take What Other Actions Against Me?
If a bank or wage garnishment against you was filed by a creditor, they very probably also filed a lien against you known as a Writ of Fien Facias (“FiFa). In the county where you reside is where the creditor files the Fi Fa, and all the property that you own is attached by it. If you have no un-exempt equity in any property, you may ask the court to extinguish the lien, when you file bankruptcy.
Are There Any Bankruptcy Alternatives Available?
In order to dispute the garnishment action, in the state of Georgia, you may file a traverse of garnishment. However, unless it shows that a judgment was wrongfully obtained or is void, a traverse will not be successful. It is difficult to show any wrongdoing, if the creditor before filing the garnishment suit, sued you and served you properly. In addition, in the filing of a traverse, you very often return to where the judgment was issued in the original case, to dispute that judgment’s validity. It may be grounds for vacating the judgment, if you were never served with a copy of the lawsuit.
Of course, with the judgment creditor, you may also try to settle the debt. Settling the debt at a reduced rate however, will be more difficult if you have already arrived at the garnishment phase. Usually, you will want to offer a lump sum of some significance, if you are seeking to settle at a reduced rate.
Please call the Law Offices of Matthew C. Hines at (770) 941-0913 , if you have any further wage garnishment questions. Or you can contact attorney Matthew C. Hines on the web and obtain a free consultation.