If you’re living in Utah and your wages are being garnished, you may be wondering if bankruptcy is a way to stop the garnishment. Bankruptcy is not always the easiest solution for everyone but with some help from an experienced bankruptcy attorney it can be possible for you to free yourself from the debt that is causing your wages to be garnished.
Wage garnishment occurs when your wages are withheld by an employer because you owe money—in most cases made up of child support or tax obligations—to another party. This is only legal after obtaining a writ of garnishment from the court system. The creditor (the person you owe money to) will provide this document to your employer so that they may withhold part of your wages until the total owed has been satisfied.
However, if there isn’t enough income being brought into the household then it becomes necessary to look at other financial options. In some cases, this might include filing for bankruptcy. Bankruptcy is a legal relief option that will stop most types of creditors from taking further action against you until the situation has been resolved.
In order to file for Chapter 7 bankruptcy, your income must be low enough that the disposable income left over after expenses is less than or equal to what is allowed by law. If your case meets these economic guidelines then you may be able to have certain debts discharged—this includes those owed as a result of garnishment—in as little as 90 days.
If filing for Chapter 13 bankruptcy sounds like a better solution it’s because it could allow you to pay back as little as 10% of your debt each month and still get out of debt in three to five years. This would allow you to keep your income and stop the garnishment immediately.
Once the bankruptcy process is complete, all collection activities are ceased—including wage garnishments—until the creditor re-files against you for any reason. This means that until further action is taken by a creditor, you will be able to live free from wage garnishment if you file for bankruptcy.
The wages being garnished must be low enough to allow for disposable income below or at the state’s threshold. If filing for Chapter 7 bankruptcy you must make less than the state’s median income, which is $54,362 per household as of 2012. Your debt load must also exceed certain limits that are calculated by your income and family size—if these figures are accurate then you may be able to file for Chapter 7 bankruptcy protection. If you’re earning more money per year then this changes slightly but unless you are earning significantly more than the median amount in Utah it typically boils down to whether or not you can pay back a certain percentage of your debt without any significant financial strain on yourself or your family.
If you are earning more money per year than the state’s median income, then filing for Chapter 13 bankruptcy is typically your best option. This type of bankruptcy allows you to consolidate all of your debt into one low monthly payment that will be distributed amongst various creditors while giving you a timeframe (typically 3-5 years) in which to pay it back properly. If by the end of this period you haven’t paid off all of your debt then the remaining balance will be discharged—meaning that if wage garnishments were still occurring they would no longer be able to do so until further legal action was taken against you by the creditor(s).
Depending on how much disposable income remains after rent, utilities and other expenses have been paid, filing for bankruptcy could provide you with relief from wage garnishment immediately. This means that you’re able to keep your income while removing the financial strain of repaying the debt.
As soon as you file for Chapter 7 or Chapter 13 bankruptcy protection, all debts owed are frozen until a decision has been made by the courts . This means that creditors are not able to continue with legal action against you and even if they do, it’s considered illegal and cannot be enforced. Once your case is filed and finalized—typically within 90 days —the court will order all creditors to stop any collections activities including those involving garnishments.
At the end of the day, filing for bankruptcy can help remove many different types of stressors from your life so that you can get back to just living. An experienced Utah bankruptcy attorney could help relieve this stress and make the process as painless as possible while still allowing for a sense of relief in knowing that you’re able to live your life without such heavy financial burdens.
If it’s time to stop wage garnishments from occurring due to unpaid debt, then filing for Chapter 7 or Chapter 13 bankruptcy may be an option you’ll want to further explore with the help of a professional. With some help from an attorney in this area of law, they can help guide you through each step of the process including filing and finalizing your case—which typically takes between 90-120 days depending on how quickly all paperwork is and returned to court after being filed.
The decision to file for bankruptcy is not one to be taken lightly but if it’s possible for you to benefit from this process then it can be well worth it. A professional in the area of bankruptcy law will be able to determine your eligibility and whether or not filing for bankruptcy protection is right for you. If wage garnishment has become an issue in your life due to unpaid debt, getting help with this financial stress could relieve some of the pressure—freeing up income so you can continue living your day-to-day life without worrying about creditor harassment.
If you are currently being harassed by creditors regarding pending legal action that may include wage garnishment, getting help fast could stop their collection efforts before they get started.
Discuss your options with one of our bankruptcy lawyers today! To discuss with an experienced attorney, call us at 801-285-0980.
At Blue Bee Bankruptcy, our lawyers are highly experienced in the various filing options.
More importantly, we understand that each case we receive is unique and each client has different needs and goals. We will discuss these signs with you and decide the best route to take.
We strive to help our clients rebuild their lives and take steps toward a better financial future through filing.
If you’re dealing with the potential of bankruptcy, give us a call. Our team will work to help you by reviewing all of the options our firm has available. We will ensure you’ll get the best possible outcome for your situation.
Get in touch today so we can start working on either halting bankruptcies or preventing them from taking place altogether!
Contact Us Today For Help! You can schedule your free consultation online or call us at (801) 285-098.