Arizona allows creditors to garnish wages for a variety of debts. You could face a substantial wage garnishment if a creditor obtains a personal judgment for an unpaid debt. Our Peoria wage garnishment attorneys can help you explore bankruptcy options that stop debt collection lawsuits and prevent wage garnishments. If your wages are being garnished now, call our office to discuss how bankruptcy can get rid of wage garnishments.
How Does a Wage Garnishment Begin in Peoria?
If you owe a medical debt, credit card bill, repossession deficiency, or personal loan, the creditor can sue you to collect the debt if you do not pay the debt. The creditor files a complaint seeking a monetary judgment for the debt you owe. You can respond to the complaint and request a hearing to argue that you do not owe the debt.
However, unless you have proof that you are not legally liable for the debt, the court may enter a judgment for the creditor if the creditor provides evidence of the debt. If you ignore a debt collection lawsuit, the court enters a default judgment against you if the creditor provides the court with sufficient evidence that you owe the debt.
Once the judge enters an order in favor of the creditor, the creditor can request a wage garnishment order. With a wage garnishment order, the creditor may garnish up to 30 times the federal minimum wage rate from your income or 25 percent of your net income, whichever amount is less.
Most income is subject to wage garnishment orders. Retirement income, Social Security benefits, workers’ compensation income, and unemployment income are typically exempt from a wage garnishment order.
Filing Bankruptcy To Stop Wage Garnishments
Filing a bankruptcy case stops wage garnishment. The type of debt and the creditor that is garnishing your wages determine the outcome for the debt.
If the debt that created the wage garnishment can be forgiven in bankruptcy, the debt should be discharged, and the wage garnishment does not begin again.
However, if the debt that created the wage garnishment is not dischargeable in bankruptcy, the wage garnishment resumes when you complete a Chapter 7 case.
In a Chapter 13 case, the debt must be paid in full through the Chapter 13 plan, unless the debt is a student loan. The wage garnishment for the student loan debt will not resume during the Chapter 13 case, but it could after you complete your Chapter 13 plan if you did not pay the debt in full while you were in a bankruptcy case.
Before filing a Chapter 13 or Chapter 7 bankruptcy case to stop wage garnishments, it is best to consult with an experienced Peoria bankruptcy lawyer. There could be consequences of filing for bankruptcy relief that you might not be aware of unless you talk to a bankruptcy lawyer. Get advice from a trusted legal advocate for debtors before taking any steps to file a bankruptcy case.
Contact Our Peoria Wage Garnishment Attorneys for Help
Wage garnishments can create a financial hardship for the person and the person’s family. Most people live paycheck-to-paycheck. Losing any portion of income can be devastating. Our Peoria wage garnishment lawyers review the order free of charge and advise you of your options for stopping a wage garnishment.