Garnishment is one of the most effective strategies available for collecting a debt. Bank garnishment allows a debt collector to freeze a person's bank account while withdrawing money electronically for the debt. Wage garnishment allows debt collectors to receive a certain percentage of the debtor's paycheck each pay cycle. Laws governing garnishment do not require the debt collector to give advance notice of the action.
Considerations
The element of surprise is a key part of a debt collector's garnishment strategy, especially with bank garnishment. The debt collector seeks to tap into the debtor's bank account before the debtor can close the account or transfer all funds to another bank. The surprise factor isn't critical in wage garnishment because the employer must comply with a court order for garnishment.
Process
Debtors paying attention to their affairs should know when garnishment is possible. To proceed with garnishment, debt collectors must file a lawsuit and collect a monetary judgment signed by a judge. A debtor properly managing his financial affairs will know about the judgment and the possibility of garnishment to collect the debt. The debtor can do nothing to avoid wage garnishment if the debt collector wins a garnishment order from the judge, decides to proceed with garnishment and knows where the debtor works. However, some debtors fearful of bank garnishment remove money from bank accounts and have paychecks deposited onto prepaid debit cards.
Default Judgments
Some debtors learn about garnishment only after merchants decline their debit card because of insufficient funds or they receive bank notices about bounced checks, which happens sometimes after so-called "default judgments." Some people stressed out over debt refuse to read or respond to court notices, forcing a judge in the case to award an automatic victory to the debt collector. That's the only move the judge can make if a debtor fails to appear in court for a debt lawsuit. After the default judgment, a debt collector may quickly request garnishment.
Soultions
Debtors with court judgments, debt lawsuits and garnishment should consult with a consumer affairs attorney and prepare to move on to a bankruptcy attorney if the problems are severe. Meeting with a consumer affairs attorney is a good place to start. Depending on the situation, a consumer affairs attorney can file a legal motion to temporarily set aside a default judgment pending a hearing before the judge. The attorney can also contact debt collectors directly to negotiate payment plans or settlements. Bankruptcy becomes a consideration when the debtor is unable to meet daily living expenses because of garnishment and debt collectors are not willing to agree to affordable payment plans or settlements.
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