Articles Posted in Garnishments

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If you are thinking of filing bankruptcy due to a Wage Garnishment Order, you are probably wondering whether or not the bankruptcy will simply only stop future garnishments or whether it will also help you to get your garnished wages back. As long as your wages are not being garnished due to unpaid child support or student loans for example, then filing bankruptcy will stop your future wages from being garnished and it might be possible to get some of your garnished wages back. But, the surroundings circumstances must be in your favor in order to get you wages back; specifically,

  1. The wages garnished must have been $600.00 or more within the 90 days prior to filing bankruptcy as you can only recover garnished wages from the 90 days preceding filing bankruptcy; and
  2. You can exempt the wages once they are returned to you.

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tax-debt-forgivenessA civil judgment is obtained when you fail to pay a debt that you owe, such as a credit card debt, and the creditor/lender files a civil lawsuit against you in state court for a breach of contract. If you fail to respond to the lawsuit and/or do not have a valid defense, a civil judgment is entered against you. If it is a relatively small judgment amount and you do not have a lot of other debt, then it might be best to simply set up a payment plan to pay it off. However, if the judgment amount is large, is more than you can handle, or you have a lot of other debts, then you might want to consider bankruptcy in order to get a fresh start.

The good news is that bankruptcy will discharge the majority of civil judgments entered against you, but there are a few exceptions. It depends entirely on what the underlying debt was for and whether a lien has been placed on your real property. There are certain types of judgments that cannot be discharged with a bankruptcy.

The most common type of civil judgment is a judgment for unpaid debts, such as a credit card, medical bill, rent, repossession or personal loans, just to name a few. If your judgment is for a debt such as one of these, then it is most likely dischargeable through bankruptcy.

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Untitled-1What is Wage Garnishment and how does it work?

Wage garnishment is a court order that compels your employer to deduct a certain amount of money from each paycheck you receive and send it directly to your creditor until your creditor is paid in full. Luckily there are limits set by law on the amount of money that can be garnished from each paycheck.

Florida requires your creditor to first obtain a judgment from a court before they can request a wage garnishment. Once a judgment order has been obtained, your creditor files a Motion for Continuing Writ of Garnishment with the Court. The Court then provides a Continuing Writ of Garnishment Against Salary or Wages, which is served on your employer. Your employer then has 20 days from receiving it to file a response with the Court. Your employer’s answer must state whether or not they are in fact your employer, as well as the frequency of your pay periods and the amount of your salary and wages. The writ then directs your employer of where to send the withheld money and how much shall be withheld. The only instances where your paycheck can be garnished without a judgment from the court is when it is for debt owed for income taxes, child support, or student loans.

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Jacksonville Bankruptcy LawyerAs a Jacksonville Bankruptcy Attorney I am always being asked numerous questions about Florida Bankruptcies and their effect on individuals you file. Although individual results will vary, I strongly encourage you if you are considering Bankruptcy to consult with a local Jacksonville Bankruptcy Attorney. With that being said, here is a list of the 5 most common benefits applicable to most of my clients when filing a Florida Bankruptcy.

  1. Gives you a “Fresh Start.” This means you liability for your dischargeable will be eliminated.
  2. Will stop Foreclosure proceedings or allow you time to catch up on past due payments.
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Protect your funds with Garnishment DefenseThere are several steps that must occur before you can be garnished. Typically, a creditor must file a complaint, serve the debtor with a copy of the complaint then, if they debtor responds they fight it out in court or, more commonly, the debtor never responds and a default judgment is entered against them. Once this judgment is received, the creditor can petition the court for permission to garnish your bank account.

Recent court findings state that a garnishment from a Florida court does not have jurisdiction to hear cases involving bank accounts that originated outside the state.

This creates a huge hurtle for collection agencies. For example, I came from Maine and have bank accounts that originated there. If someone attempted to garnish me in Florida they would have to obtain a judgment against me, then petition the Maine court to domesticate a foreign judgment, then would have to follow Maine laws to garnish my wages. This would require the creditor to hire a lawyer licensed in multiple states or to hire multiple lawyers.

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Wage Garnishment in BankruptcyThe head of family exception to wage garnishment also applies in an application for Chapter 13 Bankruptcy. Under the statutory exemption, an individual is considered to be the head of the family when (s)he “provid[es] more than one-half of the support for a child or other dependent.” Fla. Stat. Ann. § 222.11(1)(c). This statute allows for the head of family whose disposable earnings do no exceed the statutory amount to exempt all of his or her earnings from garnishment or attachment. Additionally, the disposable earnings of a head of family exceeding that amount may not be attached or garnished unless the individual agrees otherwise in writing, and then the amount available for garnishment is limited by 15 U.S.C. § 1673.
However, if the individual filing is only claiming a spouse as a dependent, the dependent spouse’s income must be insufficient to support him or herself without the income of the spouse claiming them. The purpose of the head of family exemption is to preserve the home and shelter for the family, so as to prevent the family from becoming a public charge.
The head of family exemption is intended to protect the family unit; therefore, when an individual filing for bankruptcy and claims the head of a family exemption, the dependent she is supporting must be receive income insufficient to independently support himself without the claimant’s income. If the claimant’s dependent is able to independently support himself, the claimant will not qualify under this exemption.

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If you want to reaffirm a debt after filing for bankruptcy, your must executed a new agreement with your creditor. This reaffirmation agreement must be written and must be signed by both you and the creditor. Should you sign this reaffirmation agreement? Here are some pros and cons.

Pros

First, if you want to keep the property, you must sign the reaffirmation agreement. Also, if you do sign, you will be certain what your payments will be, what your interest rate is, etc. Signing a reaffirmation agreement may also help rebuild your credit, since you are taking responsibility for a pre-filing debt and are making regular payments on a debt.

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Automatic Stay, BankruptcyUpon filing for bankruptcy protection, an automatic stay is put in place. This means that creditors can not try and collect from you. So a creditor cannot call you to request payment, send bills to you, garnish your wages anymore, or repossess your car without court permission. If there is a foreclosure suit against you, that suit must also stop immediately. If your home is sold and you filed prior to the sale, that sale can be vacated. Obviously, this is a powerful tool bankruptcy. Many people file to stop creditors from taking actions against them or their property.

The automatic stay will remain in effect until one of the following things occurs:

1. A creditor petitions the court for relief from automatic stay and the court enters an order granting it;

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Married Jacksonville residents seeking to defend wage garnishments may have a unique opportunity over unmarried debtors. Section 222.11 of the Florida Statutes allows any Head of family to exempt all of their disposable earnings from garnishment. Section 222.11(1)(c) defines “Head of family” as any natural person who provides more than one half of the support of a dependent.

Based on this definition, it would make sense that a husband and wife could both exempt their wages from garnishment as long as they were each providing more than 50% of the support for a child from a prior relationship.

Similarly, in a bankruptcy case, having a non-filing spouse can protect all titled marital property from liquidation by filing that property as, “Tenancy by the Entireties”. This trick is commonly used in the bankruptcy arena.

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