3 Ways to Stop a Wage or Account Garnishment
Imagine that you've worked hard for the last two weeks and today is payday. Maybe you've put in some overtime and are looking forward to having a little bit of extra pocket change. You check your bank account or your boss hands you your paycheck and something seems wrong. The amount you've received for your work is significantly lower than last week. It might be the lowest it's ever been. You look at your check or payroll stub and it says something like "garnishment" or "garnish" or "legal hold". Not knowing what's going on, you call HR or your boss. They tell you the bad news—they received a garnishment order from the Court and now they have to pay someone else money from your check. And there's nothing they can do to help.
Or imagine that you're in line at a local supermarket. You're just picking up some essentials—bread, milk, cereal for the kids. You swipe your debit card and nothing happens. It's declined over and over again. You're incredibly confused because you're sure that there is money in the account. You step out of line and call the bank. After being on hold for what seems like an eternity, you get some bad news—there's a garnishment on your account and it is frozen. You can't access your money at all. And there is nothing the bank can do to help you.
Well this isn't good.
The first thing to figure out is what happened. In almost every case, a garnishment requires a court order, which requires a judgment against you. At some point, a creditor must have gotten a judgment. Then that creditor figured out either where you work or where you bank, executed a garnishment, and now you've got a problem.
The good news is that you have options.
Option 1: Pay the judgment
The first option is both the easiest and the most difficult. If you have the money to simple pay the judgment, you can stop the garnishment almost immediately by paying the full balance owed. In reality, 99% of people who have judgments against them are not in a position to pay the judgment immediately. If you can't pay the judgment immediately (and let's be honest—most people can't pay a large judgment with spare cash), there may be other options.
Option 2: Work out a payment plan
Payment plans can be great if the creditor will let you pay a judgment without having your wages or bank account garnished. The problem you will almost always run into is that a creditor who has garnished an account or your paycheck has access to your money. Getting them to give up that access so you can pay them directly is asking them to take on additional risk that you won't pay. I can usually set up a payment plan if the case is being litigated, but setting a payment plan post-judgment almost never works. It does on very rare occasions, but it is by no means a guarantee.
Option 3: Bankruptcy
Nobody wants to file for bankruptcy. It's not a fun thing to do. It can feel embarassing and shameful. But here's the deal—the bankruptcy code exists for a reason. It exists so that people can have a fresh start instead of endlessly toiling under insurmountable debt. If a creditor is garnishing your wages or freezing your accounts, the quickest and easiest way to stop the garnishment is to file for bankruptcy. Once you file, all collection activities have to stop and all garnishments have to cease. If you're dealing with a large judgment and have your assets garnished, bankruptcy may be your best shot at solving that problem.
In any case, if your paycheck is getting garnished, you need help. You should call a lawyer to talk through your options.