Law Office of Rick Morin, PC

I have said it before and I will say it again: one of the top reasons people seek bankruptcy help is because of a wage garnishment. A Sacramento wage garnishment can have disastrous effects on your finances. Here are some tips that can help you deal with a wage garnishment.

1. Be Proactive

First of all, a creditor may only garnish your wages if the creditor first sues you in court and wins a judgement. Knowing this, your goal should be to prevent the judgement in the first place. Without a judgement, there can be no garnishment!

With the economy improving, creditors are filing more and more lawsuits on defaulted debts. Don’t just ignore lawsuit threats. Try to work out a deal with the creditor before they are forced to sue you. If a creditor thinks that their only choice is to sue you, this is exactly what they will do.

2. Don’t Delay

If a creditor does win a judgement against you, don’t waste any time. They will soon be looking to levy your bank account and garnish your wages. If you can’t afford 25% of each of your paychecks being diverted to your creditor, you should seriously consider bankruptcy as an option.

It is always best to file bankruptcy before a wage garnishment starts. If you act fast enough, you will be able to prevent the creditor from taking any of your wages. If your wages are being garnished, it may be difficult for you to save the money needed to file bankruptcy. It can be a real catch 22.

3. Don’t Ignore the Signs

Many of my clients are not aware that a creditor has sued them and obtained a money judgement. This is often the case because the client has moved and was never served with lawsuit paperwork. However, lack of knowledge of a judgement is not a legal defense if the creditor decides to start collecting.

Keep an eye on your credit reports. You should take a look at your full credit report each year. Your credit reports will clearly indicate any public records, such as judgements. If you discover judgements in your name, don’t ignore them! Collection activity could begin literally any day.

4. Don’t Assume Old Judgements are Safe

Did you know that judgements issued by a California court are good for 10 years? And that a judgement creditor can renew their judgement every 10 years thereafter? In most cases, judgements accrue interest at 10% per year! As you can see, ignoring a judgement will only make the problem more expensive.

5. Bankruptcy Will Eliminate Judgements and Garnishments

Bankruptcy will get rid of most judgements. Bankruptcy in Sacramento will also immediately halt wage garnishments and bank levies! If you are served with a notice of garnishment, you should contact my office immediately to discuss your bankruptcy options. Bankruptcy might be the easiest, fastest and cheapest way to stop your garnishment.

If you have question about stopping a wage garnishment in Sacramento, please contact my office at (916) 333-2222 for a free bankruptcy consultation.