When a creditor reaches the point of asking for a court-ordered wage garnishment, most people have already exhausted all other means of finding a suitable payment plan. At this point, your income, which is likely already not sufficient to pay back your debts, is being taken before you ever even see it. This can cause many people to go further into debt as they struggle to pay for basic necessities.
Filing for bankruptcy can not only stop a creditor from filing for a wage garnishment, but it can actually reverse a wage garnishment that is already occurring. This can help you get back on your feet because you’ll be getting your full income again. Here’s how an NYC bankruptcy can stop or reverse a wage garnishment.
Bankruptcy’s Automatic Stay
When you file for bankruptcy, the first thing that happens is called an automatic stay. This a court order that disallows any creditor from trying to collect money from you until after the bankruptcy is done. All collections activities, including harassing phone calls, letters, wage garnishments, withholding transcripts, and more, must stop.
Of course, creditors are not immediately notified of the bankruptcy – it can take several weeks for them to receive the notice and cease activity. So here’s how to get that wage garnishment stopped or reversed right away.
Stop a Future Wage Garnishment
Luckily, you don’t have to do anything to stop a future wage garnishment while you are in the bankruptcy process. If a creditor asks a court for a wage garnishment judgment, being unaware that you are in bankruptcy, this fact will be revealed to the judge that they file with, and that judge will inform them that they cannot garnish your wages until after the bankruptcy ruling.
Reversing a Current Wage Garnishment
Having an experienced lawyer on your side in an NYC bankruptcy case is even more important when you need to stop a current garnishment. Your lawyer will send a letter to the creditor, or contact them in whatever means necessary, to alert them to your status right away. The lawyer will also inform the company of the fact that they must stop the garnishment, and direct them to any relevant legal facts, as well as to all the contact information necessary for the next steps.
The creditor must then alert the local sheriff’s office to stop the garnishment, and the sheriff will notify your employer. At that point, your employer is required to stop the garnishments on your very next paycheck. Your lawyer should also contact the sheriff’s office to be sure that this has taken place, and follow up until the action takes place. Your employer cannot legally stop the garnishment until they are ordered to by the sheriff, so speaking to them directly yourself isn’t likely to help anything.
Automatic stays do not apply to court-ordered payments, like child support, alimony, or restitution for court cases. If your garnishment is due to these payments, filing for bankruptcy cannot stop these payments, nor will it be able to have these debts discharged at all.
After the bankruptcy, any creditor who was not a part of the bankruptcy filing can re-file for garnishments if they wish. The automatic stay will be lifted as soon as the bankruptcy is done. In order to get the maximum amount of debt discharged by a bankruptcy case, an experienced NYC bankruptcy lawyer is a must. Call my office at 212-244-2882 to schedule a consultation. We can help you recover your regular income level so that you can start tackling your debts for good.