Tuesday, January 13, 2015

Protecting Your Wages From Garnishment

With the prolific age of digital communications debt collection agencies are now more fierce than ever before. How can you protect your wages from garnishment? If garnished how can you fight back and recover losses?

First Step - Know Common Debt Collection Tactics

Personal and Employer Phone Harassment
Post Mail
Social Security Benefits
Tax Debt: MVA License Renewal Withholding
Wage Garnishment

The most insidious of these is wage garnishment. If you are facing wage garnishment you are likely under extreme anxiety. Much is at stake. All it takes is one unpaid bill to set a financial tsunami in motion and completely obliterate your well balanced budget and financial planning.  Immediate loss of assets in terms of home and car can ensue and pull you into a vortex of unending financial crises.   There are laws and procedures to help protect you from being financially overtaken when facing garnishment.

Wage Garnishment Process
While laws vary from state to state, understanding the basics regarding the wage garnishment process can help you fight back and stop the process before things get out of hand. Let's talk about the wage garnishment process:

1. Sheriff serves levy to employer. The court may bypass direct serving and simply mail the levy to your employer instead.

2. After serving levy Debtor has 10 days to file claim of exemption

3. Garnishments are collected from 30 to 180 days until the debt is paid in full but no more than six months.

4. Employer holds money until garnishment debt reaches full accumulation and then turns it over to the collector in one lump sum.

Second Step - Negotiate Before Garnishment

Make payments affordable. Refer to levy garnishment notice and submit a request for a slow pay motion - Submit request for judge let you make small payments

Third Step - Object To Intent To Garnish Wages 

File Objection to Intent To Garnish. You should file any objections you have to the garnishment, in writing, with the court and and request a hearing. The garnishment papers might contain forms that you can fill in and request a hearing.  If not, you'll have to complete and file something separately.

Know the law. Under federal law, your creditor can only garnish the lower of 25% of your disposable earnings (gross pay less taxes and mandatory deductions), or your disposable earnings less 30 times the federal minimum wage.  Some of the more common objections you can make include: The Creditor is Taking Too Much Money

If the amount of money proposed to be garnished from your wages exceed what federal
and state law allow, you should object to the garnishment immediately.

The Creditor Did Not Follow Proper Procedures
Look over the court garnishment papers thoroughly. Are dates, payments due and signatures accurately filled out? If the creditor did not follow garnishment procedure, then the court may terminate the garnishment order. An example of improper garnishment would be if the creditor
failed to give you timely notice of the garnishment.

The Creditor Was Paid
If you already paid the judgment, or if the creditor received full or partial payment
toward the judgment through other means then you obviously need to object so that the
creditor doesn't receive more than what it is legally entitled.

Fourth Step - Attend the Objection Hearing 
Once you have filed your objection, then you need to attend the hearing otherwise the court may overrule your objection and the garnishment will begin.

What if the court denies your objection and rules in favor of the creditor? Is all lost. No! Even if you attend the hearing and the court denies your objection, you can still use  this as an opportunity to meet with the creditor and negotiate a payment plan that will satisfy all parties and stop the garnishment.

Fifth Step - Negotiate After To to Stop Debt After Garnishment is Executed

Contact the court and request a slow pay motion to make smaller payments. This may involve appearing in court.

Sixth Step - File Chapter 7 Bankruptcy

If you file MD Chapter 7 Bankruptcy you can not only stop payments but the debt that has been collected by the employer can be returned to the employee.

Seventh Step - Create A Protected Income Stream

Protect some of your money while wages are being garnished by earning a second income to offset your losses. This can be in the form of a small side business in the form of contractual work. This for of income cannot be easily seized and garnished. For second income stream and small business ideas with little to know startup and overhead costs read the article Determining Which Business To Start.

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