You may already know that filing for bankruptcy can help you avoid a wage garnishment. In the ideal world, you’d come to our office long before the completion of a lawsuit that results in a wage garnishment. 

Yet some people fight till the bitter end, and end up losing some money from their paychecks before we are able to get that stopped on their behalf. Some just don’t realize they’re being sued or garnished fast enough to do anything about it. 

Timing is Everything

If you filed bankruptcy after months of garnishments then you probably can’t get most of that money back.

If you filed bankruptcy the day after your judgment was entered then you can get some of the money back. There is a gap between the time the creditor contacted your employer to get the money and the time that the courts contacted your creditor with the automatic stay. The creditor may take even more time to alert your employer to the presence of the automatic stay. 

You might notify your employer yourself, but that still may not be enough to keep some money from being garnished.

In this case the creditor should issue a refund.

If the creditor refuses a refund or continues to garnish your wages then the Court can hold them in contempt for violating the automatic stay. 

You may also be able to claw back money that was garnished up to 90 days before you made your bankruptcy petition. However, your trustee may claw it back into the bankruptcy estate instead of giving you the money directly. If the trustee does not want to do that, you have the option of asking your bankruptcy lawyer to sue the creditor on your behalf. 

Keep in mind that there are costs associated with doing this. You’ll need to carefully weigh the amount that you hope to get back with the amount that it will cost to sue for the money in the first place. 

Bankruptcy law is often a dance of compromises and strategies used to help you support a specific set of goals. This is one reason why it’s so vital to work with a bankruptcy attorney throughout the entire process.

Get Help Today

If you think you’re about to be sued over a debt, or if you have been sued over a debt, then it’s important to consult with a bankruptcy attorney as soon as possible. Move as quickly as possible, because current law allows creditors who win lawsuits to charge interest on the debt, which can make matters even worse. 

Reach out to the team at Haysom Law to get started today. 

See also:

Can Bankruptcy Help You Retrieve a Repossessed Car? 

Can I Be Sued While Working With a Debt Settlement Agency?

How Does Wage Garnishment Work in New York?