Judgements and Wage garnishments
If you have had a judgment filed against you or a wage garnishment, these actions can be stopped immediately with the filing a Chapter 7 or Chapter 13.
A judgment is when a creditor seeks a formal decision by a court of law in order to create or affirm an obligation, such as a debt. This is obtained so the creditor can take further actions to collect on the debt, such as a wage garnishment, liens against personal or real property, etc.
The filing of a Chapter 7 or Chapter 13 will stop a judgment from proceeding. In the case of the Chapter 7, the debts are generally dischargeable. In the event of a Chapter 13, repayment terms will set up through the program and a portion of the debt will often be eliminated at the end of the plan.
It is best to file a case prior to the establishment of a garnishment or lien against property.
Liens are non-dischargeable in the event of a Chapter 7. If a lien is in place at the time of a Chapter 13 filing, our lawyers can evaluate how to treat it within the plan. If there is insufficient value in the property to support the lien, the attorney can do a "Lien Strip." Lien Stripping will basically convert the lien to unsecured debt. Under the terms of a Chapter 13, our attorneys can often eliminate a portion of the unsecured debts, including the stripped lien. The stripped lien will be paid back at 0% interest. In addition, all payments are deferred to your unsecured creditors until you are caught up on your secured obligations, such as your first mortgage, vehicle, etc.
In the event of a garnishment, this can be stopped immediately with the filing of a Chapter 13 or Chapter 7. There are many types of garnishments: wage garnishment, bank accounts and state taxes. For wage garnishments, a creditor can garnish your paycheck up to 25% of your net pay. In terms of bank accounts and state taxes, the creditor can take whatever amount is available to satisfy their debt - even if it is your whole account balance or tax return. Social security, disability pay or other government assistance that is typically not eligible to be directly garnished can be legally taken by a creditor to satisfy a judgement once the money is deposited into a checking account.
Under a Chapter 7, if you have experienced a garnishment within 90 days of filing and the total amount taken is over $600.00, we can attempt to recover the funds and return the money to you.
We offer free in-office and phone consultations to review your personal circumstances, analyze your situation and advise you on the best course of action. Please call us toll free at 866-261-8282 or click here to schedule a consultation right now.