How to Halt a Wage Garnishment When Filing for Bankruptcy
Getting over your head in debt doesn’t just create financial pressures for you. The more delinquent you become with your accounts, the more calls and emails you will get from your creditors, both at home and at work. You will get the calls every day of the week and during the day or at night. It will get to the point that you don’t want to answer the phone or open up your email.
As time goes on, your creditors will take more measures to try to get you to pay your debt. Eventually, they may even file for a wage garnishment, which would allow them to automatically deduct your paycheck for a specific amount. Your creditors can’t just decide to do this on their own. They have to petition the court to approve the process, and they are limited in how much they can garnish. The court will determine how much can be garnished based on how much you make, how much you owe, and how long it will take to pay back the debt.
You can put an immediate stop to wage garnishment by filing for bankruptcy in Mesa. Whether you file for Chapter 7 bankruptcy or Chapter 13 bankruptcy, an automatic stay is issued, which puts a stop to all collection activities, including wage garnishment and harassing phone calls.
What Happens after the Automatic Stay
Filing for bankruptcy in Mesa and getting the automatic stay issued is just the first step in the bankruptcy process. After that, you will need to provide information about your income and your debts in your filing.
If you are filing for Mesa Chapter 7 bankruptcy, you will be asking to have all your unsecured debt, such as credit cards, discharged. You will provide all the information, and you will attend a meting of the bankruptcy trustee to review the information and to get a judgement. Your creditors will have a chance to attend that meeting, but few do. If the Chapter 7 bankruptcy is issued, that debt will be discharged. If the creditor that was garnishing your wages was an unsecured creditor and that debt was discharged, the wage garnishment will be ended permanently.
If you are filing for Chapter 13 bankruptcy, you will work with your attorney to develop a debt repayment plan that will last between three and five years. Your Mesa Bankruptcy attorney will negotiate your debt so that you have an affordable monthly payment and perhaps a lower interest rate. You may get some of your debt discharged if you are not able to repay everything within that three- to five-year period. Wage garnishment will stop since you will have a new repayment plan.
Qualifying for Bankruptcy
You can’t just decide that you want to declare bankruptcy and then file the paperwork. You must meet the eligibility criteria to file. For Chapter 7 bankruptcy, you must meet a “means test,” which looks at how your income compares to the poverty level where you live. The means test also takes your monthly bills into consideration, as well as your assets.
Chapter 13 bankruptcy also has eligibility criteria, but they are not as strict. It is best to talk through the criteria with a qualified bankruptcy attorney in Mesa who can help you understand the best strategy.
Wage garnishment can be embarrassing, and it can end up causing more financial hardship for you since you now have to operate with even less free income each month. But filing for bankruptcy can put an immediate end to the wage garnishment and can help you get lasting debt relief.
Talk to one of the experienced Mesa bankruptcy attorneys at My AZ Lawyers to learn about your options. An attorney from our team will review your finances and debts to get a better picture of your situation and will recommend a course of action. You will learn whether Chapter 7 or Chapter 13 bankruptcy would be better for you, and your attorney will help you understand how to get maximum debt relief. Call our office in Mesa right now to talk with an experienced bankruptcy lawyer about your options for debt relief. We serve clients through the Phoenix, Glendale, Mesa, and Tucson areas.
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