Many creditors and collection agencies threaten to garnish wages to scare people into making a payment. The truth is that creditors must first file a lawsuit for breach of contract and obtain a judgment for non-payment of the debt. Getting a judgment is not free and it will cost a creditor between $1,000 and $2,000 to get a default judgment against someone. There is a court filing fee and the lawsuit must be personally served on the defendant. If an answer to the complaint is not filed, then the creditor who filed the complaint may request that the Court enter a default judgment.

Once a creditor has obtained a judgment, they can enforce it by garnishing the judgment debtor’s wages. Again, wage garnishment is not free and requires a series of steps. Eventually, the payroll department of the person against the judgment will be notified with the lien/garnishment deed. At this point, it is only a matter of time before the judgment debtor’s wages are garnished if all procedures have been followed correctly. A judgment debtor’s wages can be garnished up to 25% depending on the circumstances.

The good news is that wages garnished in the 90 days prior to the bankruptcy filing date can be returned if certain requirements are met. While wage garnishment is a sign that it is time to consult an experienced San Jose bankruptcy attorney, it is not the end of the world. You can stop the wage garnishment and recover some of the money by filing a Chapter 7 or Chapter 13 bankruptcy as soon as the wage garnishment begins. Contact one of our experienced San Mateo bankruptcy attorneys today and request a free consultation.