The Advantages of a Bankruptcy Attorney for Guidance

Posted on: 29 March 2022

Bad financial situations tend to only get worse with time. The people that you owe money to can take some unbelievably punitive actions when you don't pay according to the agreements. One move they can make is to take money from your paycheck before you even get a chance to do anything about it. Read on and find out more.

How Does it Happen?

After several months of not paying your credit card bills, medical debts, and other types of bills, the creditor may turn your account over to a collection agency. Then, the agency will begin a mail, phone, email, and text message campaign to collect the debt. At some point, either the collection agency or the original creditor will file a suit against you for the bills. In most cases, they will win and that means a judgment is handed down against you.

With that judgment, your wages can be legally garnished. That means the court contacts your employer directly and orders them to remove a certain sum of money (a percentage of your income) from your paycheck and send it to them directly. This wage garnishment action will continue until the debt is paid or you take action yourself. In many cases, the sum of money you owe will now include late charges, interest, legal fees, and court fees. You may owe up to three or more times your original debt once your wages are garnished. Along with wage garnishment, you may also have your bank accounts levied and your property is frozen using liens.

Put a Stop to Wage Garnishment

If you have not considered filing chapter 7 bankruptcy, this could be your wake-up call to do so. It's better to take action and file before things get to that point. Once you file for bankruptcy, the automatic stay puts an immediate stop to all punitive debt collection and court judgment actions. However, be sure to take the following into consideration:

• If you owe the IRS, only certain older debts will fall under the power of the automatic stay. Speak to your bankruptcy lawyer to find out more if you owe tax debts. Unpaid child support and student loans are other areas that should be discussed with your lawyer.
• Not only does the automatic stay that comes with bankruptcy give you back all your paycheck again, but that debt will go away completely — never to return.
• You may not be contacted by any creditor once you file your paperwork for any reason. If they do contact you, inform your bankruptcy lawyer about it.

Speak to bankruptcy law services to learn more.