Will filing bankruptcy stop a wage garnishment? | Milwaukee, WI

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Home 9 Chapter 13 Bankruptcy 9 Will filing bankruptcy stop a wage garnishment?

Will filing bankruptcy stop a wage garnishment?

by | Jan 6, 2010 | Chapter 13 Bankruptcy, Chapter 7 Bankruptcy

Yes, filing bankruptcy will stop a wage garnishment. Oftentimes, clients come to us because their wages are being garnished as a result of a judgment regarding credit card debt. (Please note filing bankruptcy cannot stop a wage garnishment for domestic support.) When a bankruptcy is filed an Automatic Stay is put into place. This means that creditors may no longer contact or collect from the recently filed debtor, therefore stopping the wage garnishment. The debt the garnishment is paying will now be resolved through the bankruptcy. After the bankruptcy petition has been filed, a case number will be assigned. The debtor or his/ her bankruptcy attorney should notify the Human Resources or Payroll Department at the debtor’s place of employment that a bankruptcy petition has been filed. This can be done by sending them the first page of the petition which serves as the proof of filing. It is also beneficial to send the creditor’s attorney a copy of the proof of filing too. Once both parties have received notice, it may take up to a week to stop the wage garnishment. In some cases, it may be possible to recover a portion of the wages that were garnished before you filed bankruptcy. -written by Stacey Martinez, Legal Assistant