How to Stop Wage Garnishments Without Going Bankrupt?

 

When you're unable to pay your debts, the creditor can collect them through the court system by initiating a lawsuit against you. The resulting process is known as wage garnishments. If the creditor wins the case, they can cover the bad debts by borrowing your wages on the court's orders. Once they win the judgment against you, the creditor will notify your employer with the sheriff's help. After the process concludes, a fixed portion of your paycheck will go to the creditor before you even receive the monthly salary.

How to Stop Wage Garnishments?

The easiest way to deal with a wage garnishment is to pay off the lump sum amount. See if you can apply for a loan or borrow from friends or family. If this doesn’t work, here are a few alternative strategies that could work:

• Negotiate With Your Creditor

You can work with your creditor to agree on a repayment plan. Before talking to the creditor, create a budget, and consider what you can actually pay. A successful repayment plan needs to be aligned with your budget. However, negotiations can only work if the matter hasn’t gone to the court as of yet. The creditor will not accept your repayment plan after the court has ruled a judgment against you. A debt resolution service could help you reach an agreement with your creditor.

• Apply For Exemptions

Wage garnishment exemptions help citizens protect their wages and pay their living expenses. The exemption laws vary across states, and not everyone can qualify for the exemptions to the same extent. In most cases, the creditor can't garnish any income that you derive from alimony, social security, child support, disability benefits, and retirement.

Your total annual income also governs the extent of exemptions that you'll qualify for. Low-income borrowers are usually able to keep most of their wages. However, you need to claim an exemption through the standard legal method, or else your wages will always be subject to garnishment.

• Challenge the Garnishment

You can challenge the garnishment if you feel like:

· The judgment was entered wrongly.

· The creditor is taking too much money. Under the law, your creditor can only garnish either 25% of your disposable income or your total income minus 30 times the federal minimum earning—whichever is lower. Similarly, if you’ve defaulted on student loans, the creditor can only collect 15% of your wages.

· The creditor did not follow the correct procedure or failed to give you timely notice of the garnishment.

In either case, a tax resolution service like Empire Tax Solutions can help you win your right to keep the wages. Other than wage garnishments, they’ll also help you manage your taxes with the IRS. Get in touch.