Wage garnishment occurs when a creditor you leave unpaid, such as your credit card company, seizes a portion of your wages from your employer before you receive your paycheck. Because garnishment is a legal process, no creditor can seize any portion of your paycheck without your consent unless it has a court's permission to do so.
After a Lawsuit
No unsecured creditor other than the federal government can seize your wages without a court order. Credit card companies obtain a court-ordered garnishment by winning a lawsuit against you. A successful lawsuit provides the company with a civil judgment it files with the court in exchange for a wage garnishment order it must deliver to your employer.
Debt in Collections
While all credit card companies' policies differ, most credit card providers give debtors 180 days to catch up their delinquent accounts before charging off the debt and sending it to an in-house or third-party collection agency. Thus, your credit card company is not likely to sue you and seek garnishment for one or two missed credit card payments.
The credit card debt you owe does not disappear as it changes hands. In-house collection agencies are owned by the original creditor, but third-party collection agencies are not. A collection agency has just as much right to garnish your wages after a lawsuit as the original creditor.
Statute of Limitations
Credit card debt has a separate statute of limitations in every state. While the statute of limitations does not prevent creditors from suing, it does provide the debtor with an impervious legal defense.
Lawsuits, however, are time consuming for both credit card companies and collection agencies. Your creditor would much rather you pay off your delinquent debt voluntarily. Thus, a lawsuit is typically a last resort for the company, and the lawsuit and garnishment process will begin immediately prior to the statute of limitations expiring on your debt.
Upon Employment
Sometimes a creditor sues a debtor only to discover that his lack of employment bars the company from garnishing his wages. If a creditor previously obtained a judgment against you for unpaid credit card debt and you become employed while the judgment is still valid in your state, your creditor will file for wage garnishment as soon as it discovers that you are employed and locates your new employer.
Finding new employment gives you only temporary relief from wage garnishment. Even if you switch employers to escape a previous wage garnishment order, your creditor will follow the same process with your new employer as it did with your original employer and continue the garnishment process until you pay off your delinquent credit card debt in full.
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