When a person takes out a credit card, allowing him to make loans against a line of credit, he runs the risk of incurring steep penalties and fees if he fails to pay the loans on time. When this happens, the person may find himself up to his neck in debt, at which point he may face severe collection actions from his lender. In Nevada, this can include garnishment.
Credit Card Debt
A loan made against a credit card constitutes a legally binding debt obligation incurred by the borrower. The borrower must pay this money back within the time specified by the contract he signed with the credit card company. If he doesn't, he can be sued, because he has breached a legal contract. In Nevada, the credit card company has a right to receive damages in the amount that the borrower owes it.
Garnishment
One of the ways in which a credit can secure payment from a debtor is through wage garnishment. In order to to garnish -- i.e., forcibly seize a portion of -- a person's wages, a credit card company must first receive a writ of garnishment from a civil court judge. To receive this, the credit card company must first bring a lawsuit against the debtor and win it, after which he receives damages.
Nevada Law
Not all states allow companies to garnish wages for private debts. However, Nevada does. Not only can a credit card company garnish the wages of an individual, but it can also attempt to seize money directly from his bank account. However, while a creditor can garnish wages and seize bank accounts in Nevada, there are certain limits on what can be garnished and how much. For example, a creditor can only garnish a maximum of 25 percent of a person's wages.
Considerations
While a credit card company can legally sue a late payer for defaulting on the loan, it may not necessary do so. Garnishment can be experience, as the company must bear the legal cost of a lawsuit, so many companies forgo it. In addition, the creditor cannot garnish most kinds of government benefits, including Social Security payments. In addition, some low-income people may enjoy protection from garnishment, particularly if they are supporting dependents.
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