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Federal And State Wage Garnishment Laws

Consumers, creditors and collectors can use State and Federal garnishment laws to start, stop and avoid wage garnishment actions. Wage garnishment (except for student loans) is only possible after collectors and creditors obtain a court order judgment for this action.

Wage garnishment laws include bank accounts, attaching wages and student loans in default. The law does not describe how to stop wage garnishment. The garnishment action, otherwise known, as “administrative wage garnishment” can be up to 25 percent of your income.

The best way to prevent wage garnishment action is to be pro-active when dealing with your creditors and debt collectors. Or better yet, plan ahead and be ready to make your monthly payments when they become due.

Each state has their own individual set of rules and laws. It is necessary if you are delinquent with your loan payments and feel a wage garnishment could be placed upon you to investigate the laws immediately in the state in which you live. That way you will know exactly what you are up against.

A Breakdown Of Wage Garnishment Laws

A summary of the laws will be presented here. To explain and write out each law it its entirety would encompass a small booklet or magazine. Hopefully, this will explain the main points and from here you can investigate the Internet, library, court journals, etc. for exact points.

The maximum for allowable of garnishment earnings of an individual for any work week may not exceed 25 per cent earnings for that week, or the amount by which disposable earnings for that week exceed thirty times the Federal minimum hourly wage, which ever is less.

No employer may discharge any employee due to the fact that his earnings have been subjected to garnishment for any indebtedness. And whoever willfully does violate (or fire) the employee because of his wages being garnished shall be fined not more than $1,000 or imprisoned not more than one year.

Specific restrictions apply to court orders for those involved with child support or alimony. The garnishment law allows up to 50 percent of a worker’s earnings to be garnished for this purposes or up to 60 percent if the worker is not.

Generally, Social Security benefits are exempt from garnishment or other legal process or from any bankruptcy law. The exceptions are: delinquent Federal taxes and child support payment and alimony obligation.

A garnishment order for the collection of a defaulted student loan can also be served. The limit for normal garnishment of this type is 25% and applies to the debt for the outstanding student loan. Under the formula a maximum for $60.00 (25%) of $240.00) would be the amount.

The Borrower Does Have Rights And Responsibilities

The debtor may object to garnishment on a number of grounds and also has the right of a hearing process. The borrowers may also object on basis such as grounds as the validity of the claim, financial hardship, and undue hardship on the family, incorrect information, death, disability, forgery and several other agreements.

The laws of wage garnishment and fair debt collection are wide and complex. We have only touched on a few basic concepts, rules and laws. For further information, check with government agencies, or the Internet which will direct you in many extensive areas.