By Ryan C. Wood
If you are facing an impending wage garnishment, or are currently having your wages garnished and live in San Jose, California bankruptcy could help. A judgment creditor or a government agency can garnish your wages up 25% of your monthly gross income. That is right. The amount garnished is pre-tax and deducted from your gross wages. To find out how bankruptcy can help you please give us a call at 1-877-9NEW-LIFE to schedule a free consultation with our bankruptcy lawyers in San Jose, California. There are number of issues to address and ways to stop wage garnishment.
1. File bankruptcy to stop the garnishment of your wages.
Filing for bankruptcy protection will stop wage garnishment and should discharge the underlying debt as the basis for the wage garnishment. As soon as a bankruptcy case is filed the automatic stay takes effect stopping any and all collection activity, including wage garnishment. The creditor doing the garnishment must be provided notice of the bankruptcy filing to know to stop the garnishment. That can be accomplished either by fax when the case is filed, or just let the creditor receive notice in the mail directly from the bankruptcy court. Creditors will usually receive notice in the mail seven to ten days after the case is filed. When garnished wages are involved we need the creditor to get notice sooner than later. Stopping wage garnishment is always about timing. It can vary depending upon the time of the month you are paid, when your employer processes their payroll and most importantly when is the actual bankruptcy case filed? Are we filing the case 7 days before you are paid next or the day before? Obviously filing the case with as many days before your next paycheck is issued would be best. Which chapter to file under depends upon your income, expenses, debts and assets.
Stop Wage Garnishment in San Jose, California by Filing Bankruptcy
2. Does the creditor have proper grounds to garnish your wages?
The first issue to address is whether the creditor has a right to garnish your wages at all. If the creditor is trying to garnish your wages to enforce a judgment the question is whether the lawsuit was valid and were the summons and complaint properly served on you? We have successfully dismissed lawsuits for improper service of the summons and complaint and therefore stopped the wage garnishment. It all depends upon your facts though. The proof of service filed by the judgment creditor will have to be obtained to find out how the judgment creditor alleges they served you with the summons and complaint. If they did not serve you legally then you may have grounds to have the judgment vacated and possibly the entire case dismissed. Litigating whether the summons and complaint were served properly can be expensive though. A cost benefit analysis must be discussed prior to attempting to have a judgment vacated. In certain circumstances we may successfully have the judgment vacated, but the creditor still might have time in which to properly serve you with the summons and complaint. If so, what have we gained by vacating the judgment other than temporarily stopping the wage garnishment?
3. File a claim of exemption to reduce the amount garnished each check.
When stopping wage garnishment in San Jose, California you may file a claim of exemption to reduce or eliminate the wage garnishment entirely. The claim of exemption is filed with the levying officer. In California the levying officer should be the county sheriff department. The claim of exemption basically makes you list your income and expenses to prove to the court that you cannot afford to have your wages garnished at all, or that the amount should be reduced given your expenses. If you have dependents or other expenses that are absolutely necessary it is more likely that the amount garnished will be reduced. The creditor may request a hearing though and then it will be up to the court as to whether the garnished amount is reduced.
4. Satisfy the Debt in Full, Negotiate a Settlement or Agree to Installment Payments
Another possible option is to just pay off the debt or settle the debt for less than what is owed. The problem most people run into is that they just do not have the cash to pay off the debt or settle the debt. Also, why would a creditor now allow you settle the debt when they are garnishing your wages for the full amount owed? The creditor may not be agreeable. At the same time, receiving a lump sum cash payment today is always better than having to wait three years to be paid in full. It all depends upon the circumstances. To stop the wage garnishment you can attempt to make arrangements to make payment voluntarily each month instead of being forced to through your wages. Hopefully if the creditor is willing to accept payment directly they will accept an amount that is less than the amount they could receive from the wage garnishment.
How to stop wage garnishment in San Jose, California can be accomplished by a few different ways. It all depends upon your circumstances and what you believe is the best thing for you and your family. Stop wage garnishment today by filing for bankruptcy protection with our law firm. We will provide you with the personal service you deserve for a reasonable fee.
