Time is money – When you owe a debt and you get sued, a fast timer starts that you can’t afford to ignore. If you want to keep control over your own money, you need to act fast. That means you can’t afford to sit on your hands.

Here are the realities: #1: Most credit-card companies don’t sue very quickly. So if you’re being sued, it means you’re in pretty serious financial trouble. Most bad debts don’t stay with the credit-card companies, but are sold off to collection agencies at rock-bottom prices. The collection agency then hounds you to pay up. Since they paid so little for your debt, any money they squeeze out of you is pure profit to them.

Here’s how it works: Whether or not the collection agency sues you depends on its business model – Some collection agencies file lawsuits all the time and some don’t. One collection agency might try to shake you down for money, but if you don’t pay up, they’ll sell off your debt to another collection agency, which might turn around and sue you in court. Most of these debt-collection lawsuits are pretty profitable for the debt collector because most people don’t show up in court. That’s how they take your money – when you don’t show up in court, the debt collector gets a judgment against you. After the debt collector gets a judgment against you, the court will give them permission to garnish your wages or to take money straight out of your bank account.

#2: When you get sued by a collection agency, give them a run for their money. If you up the ante by making them do work instead of just getting a quick judgment, there’s a good chance that you’ll come out ahead. Collection agencies are not stupid. They know that their profit lies in doing as little work as possible for as much money as possible – your money. A collection agency that makes too many wrong bets will soon be out of business. The ones that are in business know what they’re doing. The collector counts on you to put your head in the sand and to ignore the lawsuit so that it can get a quick judgment against you. You can beat them at their game by protecting yourself BEFORE they get their judgment. Don’t let the debt collector catch you with your pants down!

#3: Once you receive a lawsuit, you don’t have much time! If you don’t respond in time, you lose. I know what you’re saying – “I owe the debt! How could I win?” Even if you end up paying something on the debt, the difference between NOT responding to the lawsuit and responding means the difference between NOT controlling your own money (if you don’t respond) and keeping control over your own money (if you do respond). Do you ant the debt collector dipping their hand into your checking account or not? If not, give me a call! I can help you keep control over your own money by defending the lawsuit and/or negotiating a beneficial settlement for you.

Call attorney Jennifer Weil now at (201) 676-0722.

Are you facing wage garnishment and seeking swift relief through bankruptcy? Discover how bankruptcy can quickly halt wage garnishment and provide much-needed financial relief.

Wage garnishment can be a distressing experience, leaving individuals struggling to make ends meet while creditors seize a portion of their earnings. Fortunately, bankruptcy offers a powerful solution to stop wage garnishment and regain control over your financial situation.

In this comprehensive guide, we’ll explore how bankruptcy works to stop wage garnishment, the timeline for achieving relief, and the steps you can take to navigate the process effectively.

Understanding Wage Garnishment

Wage garnishment is a legal process through which a creditor can collect debts by deducting money directly from an individual’s paycheck. Common reasons for wage garnishment include unpaid medical bills, credit card debts, and outstanding loans.

While wage garnishment laws vary by state, creditors typically must obtain a court order before initiating garnishment. Once in effect, wage garnishment can significantly impact an individual’s finances, making it challenging to cover essential expenses and maintain a decent standard of living.

How Bankruptcy Stops Wage Garnishment

Bankruptcy provides immediate relief from wage garnishment through the automatic stay—a legal injunction that halts creditor actions, including wage garnishment, upon filing for bankruptcy. The automatic stay goes into effect as soon as the bankruptcy petition is filed with the court, providing instant protection against further garnishment.

Chapter 7 vs. Chapter 13 Bankruptcy

Both Chapter 7 and Chapter 13 bankruptcy offer protection against wage garnishment, but they differ in how they address debt repayment:

Chapter 7 Bankruptcy: Also known as liquidation bankruptcy, Chapter 7 involves the sale of non-exempt assets to repay creditors. Once the bankruptcy petition is filed, the automatic stay immediately stops wage garnishment. However, if the debt that led to garnishment is dischargeable, it will be eliminated entirely, providing long-term relief from wage garnishment.

Chapter 13 Bankruptcy: In contrast, Chapter 13 bankruptcy allows individuals to restructure their debts through a court-approved repayment plan. The automatic stay stops wage garnishment upon filing, and the repayment plan provides a structured framework for repaying debts over three to five years. This can offer a more sustainable solution for individuals who want to keep their assets and repay debts over time.

The Timeline for Stopping Wage Garnishment with Bankruptcy

The timeline for stopping wage garnishment with bankruptcy can vary depending on several factors, including the type of bankruptcy filed and the specifics of the individual’s financial situation:

Immediate Relief: The automatic stay goes into effect as soon as the bankruptcy petition is filed with the court, providing immediate relief from wage garnishment. Creditors are legally required to cease all garnishment activities once they receive notice of the bankruptcy filing.

Notification to Employer: Once the automatic stay is in place, the bankruptcy trustee will notify the individual’s employer to halt wage garnishment. Employers typically receive notification within a few days of the bankruptcy filing and must comply with the court order to stop garnishing wages.

Resolution of Garnishment: In some cases, it may take additional time for the employer to process the notification and stop wage garnishment entirely. However, the automatic stay prevents creditors from continuing garnishment efforts during this period, providing temporary relief until the matter is fully resolved.

Long-Term Debt Relief: Beyond stopping wage garnishment, bankruptcy offers individuals the opportunity for long-term debt relief and financial stability. Whether through Chapter 7 or Chapter 13 bankruptcy, individuals can eliminate or restructure debts, regain control over their finances, and work towards a brighter financial future.

Navigating the Bankruptcy Process

Navigating the bankruptcy process can be complex, especially when seeking relief from wage garnishment. To ensure a smooth and successful outcome, consider the following steps:

Consult with a Bankruptcy Attorney: A knowledgeable bankruptcy attorney can provide valuable guidance and assistance throughout the bankruptcy process. From determining the best type of bankruptcy for your situation to preparing and filing the necessary paperwork, an attorney can help you navigate the process with confidence.

Gather Financial Documentation: Be prepared to provide detailed information about your financial situation, including income, expenses, assets, and debts. This information will be essential for completing the bankruptcy petition and developing a repayment plan (if applicable).

Attend Credit Counseling: Individuals filing for bankruptcy must complete a credit counseling course from an approved provider before filing. This course offers valuable financial education and guidance to help individuals make informed decisions about their financial future.

Follow Court Orders: Once the bankruptcy petition is filed, it’s essential to comply with all court orders and requirements. This includes attending scheduled court hearings, providing requested documentation, and adhering to the terms of the bankruptcy process.

Monitor Progress: Stay informed about the progress of your bankruptcy case and communicate regularly with your attorney and the bankruptcy trustee. This will ensure that you stay on track and address any issues or concerns promptly.

Conclusion

Wage garnishment can have a significant impact on your financial well-being, but bankruptcy offers a powerful solution for stopping garnishment and regaining control over your finances. Whether through Chapter 7 or Chapter 13 bankruptcy, individuals can achieve immediate relief from wage garnishment and work towards long-term debt relief and financial stability.

If you’re facing wage garnishment and considering bankruptcy, consult with a qualified bankruptcy attorney to explore your options and determine the best course of action for your financial situation. With the right guidance and support, you can navigate the bankruptcy process successfully and take steps towards a brighter financial future.

Schedule a free bankruptcy consultation with Jennifer Weil, a New Jersey bankruptcy attorney, to discuss your options.

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New Jersey Debt Attorney – (201) 676-0722

New Jersey Bankruptcy and Student Loan Attorney

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I owe a debt and got sued . . . What now?!?!

Wage Garnishments: Can bankruptcy stop them?