In New York, a creditor that has obtained a money judgment may garnish up to 10% of an individual’s wages. For many people, being garnished is the wake-up call they need to begin facing their debt situation. Fortunately, bankruptcy can put an end to a wage garnishment and, in some circumstances, even recover some funds already garnished.
If your wages are being garnished by a creditor such as a credit card company, collection agency, medical creditor, or other lender, that is a result of losing a lawsuit filed against you. Perhaps you never answered the lawsuit, and the creditor obtained a default judgment; or you responded to the lawsuit but lost the case. You may have been improperly served and unaware of the judgment against you until the garnishment process began. The judgment could be old (a judgment is collectable for 20 years) so you may have known about it but thought that the creditor had given up on attempts to collect. Regardless, the creditor has obtained the judgment and served an “income execution” through the sheriff’s or marshal’s office.
Once a bankruptcy case is filed, the wage garnishment must immediately stop. The “automatic stay” goes into effect at the moment the bankruptcy case is filed, stopping creditors from any collection actions during the case.
Has a wage garnishment been served on you or your employer? If you live in Buffalo or Western New York, I may be able to help you stop the garnishment and discharge your debts. Contact me today to discuss your situation with no obligation.
Michael F. Barrett 