Utah saw 8,906 bankruptcy filings in the first 10 months of 2010 alone, according to statistics from CreditCards.com. While incomplete, this shows a picture of the debt crisis in Utah, where the bankruptcy rate of 6.4 per 1,000 people is among the highest in the nation. Utah's garnishment laws are part of the blame for the high bankruptcy rate, according to a Brigham Young University study cited in the "Daily Herald." The laws offer little protection for debtors, according to the study, so more folks are motivated to file for bankruptcy in order to stop creditors from taking money from their paychecks. No matter what your level of debt, you should be aware of Utah garnishment laws.
Time Limits
Garnishments come after a judge rules that part of your wages should be withheld to pay creditors directly. A debtor has time limits on when they can collect debt owed. After this period, they may no longer legally collect the debt and you need no longer fear garnishment.
A credit card company may continue to collect debt owed for up to four years after the debt was accrued. A written contract gives a debtor six years to collect the money, while domestic and foreign judgments are good for eight years. Garnishment judgments -- rulings from a judge that your wages are to be garnished -- last 120 days and are renewable.
Monetary Limits
Utah state law restricts the amount of your wages eligible for garnishment. The most a debtor can garnish your wages is the lowest amount of one of two formulas. First, the debtor can either take away 25 percent of your disposable earnings in a single pay period -- that is a quarter of your net earnings that do not go toward essential bills such as rent. The other formula is any amount of your earnings that exceed the federal minimum wage by a factor of 30.
Writs of Garnishment
A writ of garnishment is a legal document obtained by a creditor to obtain money or property from a debtor. Utah state law has two different writs of garnishment, one for money and the other for property. Creditors are expected to do due diligence before obtaining a writ of garnishment against property to ensure they are filing a writ of garnishment against the right person. In the event a creditor files a writ against the wrong party, that party has the right to sue for damages in civil court totaling up to $1,000, as of 2010.
Interest
Utah state law does not provide any specific provisions limiting the interest rate on a garnishment. The interest rate is determined at the garnishment hearing in court and is enumerated specifically in the judgment.
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