How Can Bankruptcy Stop Wage Garnishments?

How can bankruptcy prevent wage garnishments

Filing bankruptcy online may help you stop wage garnishments and may even enable you to recover some of your garnished wages. Today, our experts at discuss how bankruptcy can help you stop wage garnishments.

The Automatic Stay

Whether you file a Chapter 7 bankruptcy or a Chapter 13 bankruptcy, the automatic Stay goes into effect strictly prohibiting all creditors in engaging any debt collection activities. The automatic stay also applies to wage garnishments. If creditors would like to pursue collection activities after you filed bankruptcy, it must ask the Court to lift the stay. Unless the creditor has a valid reason to lift the stay, the automatic stay will remain in effect. For example, an unsecured creditor such as a credit card company simply wishing to proceed with a wage garnishment is not a valid reason for the stay to be lifted.

Exceptions to the Automatic Stay

Domestic support obligations such as alimony or child support are immune from the automatic stay. These are priority debts and are not dischargeable by filing bankruptcy. This means that if your wages are being garnished because you did not pay you domestic support obligations, the garnishments will stop even after you have filed bankruptcy.

Wage Garnishments After Bankruptcy

If you meet certain criteria you may be recover some of your wages even after they have been garnished. Usually, wages that have been garnished within a three-month period of filing bankruptcy, average about $600.00 and have enough of exemptions to cover them, are recoverable. If you fulfill these requirements, you may file a complaint with the bankruptcy court requesting that the garnished wages be returned to you.

Tips From Experts To Get Garnishments Stopped Quickly

Filing bankruptcy requires that all your creditors be listed on your bankruptcy petition so they can be notified of case. Also, it is a good idea to let the payroll department at your place of employment know that you have filed bankruptcy so they can immediately put a stop to wage garnishments.