Finding yourself in debt can be a very discouraging financial position to be in. If you have a large amount of debt that you cannot pay, one of the remedies that your creditors may have is to garnish your wages. Whether or not the creditor can do this depends on a few factors like state laws and the status of your debt.
Garnishment
A wage garnishment is a process that involves taking money directly out of your earnings to pay a debt. When this occurs, a creditor will work with your employer directly and you will never see that portion of the money. Your employer will take the money out of the money that you earn and give it to the creditor before you even have a chance to spend it. This can lower your take home pay significantly and can make it difficult to meet your other financial obligations.
Judgment
Even though it is possible for creditors to garnish your wages, they cannot simply do it randomly. To garnish your wages, the creditor has to have a judgment against you. This can only be done when you refuse to pay your debt and the creditor files a lawsuit against you. Then after going to court, the creditor can get a judgment against you by the court. At that point, the court could help them set up a wage garnishment on your pay.
Laws
Whether or not your wages could be garnished will also depend on which state you live in. Some states do not allow any garnishment whatsoever regardless of the situation. Other states have a limit on what types of debts can be garnished. All states have rules associated with how much money can be garnished from your paycheck. You can check on your state laws to determine if there is a chance that your wages could be garnished.
Bankruptcy
Even though garnishments can put a damper on your financial situation, you could potentially find a way to stop them. The easiest way to stop a garnishment is to file for bankruptcy. By filing for chapter 7 bankruptcy, you can stop all collection actions by your creditors. Your debts will be forgiven and you can start fresh. If you have a significant amount of debt to deal with, you may consider bankruptcy as the easiest way out.
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