Creditors Taking Money Out Of Your Paycheck

Creditors Taking Money Out Of Your Paycheck

If a creditor has problems in collecting a debt from you, he has a few options at his disposal. One of them is to sue you and attempt to garnishee your paycheck. What this basically means is that, since he is unable to get the money directly from you, he is asking the courts to force your employer to take money from your paycheck and send it to him. To protect you and prevent abuses by the creditor, however, both the federal and state governments have enacted a set of rules as to how this should work.

Before the creditor can take any money from your paycheck, however, is that he must first win the lawsuit. If the creditor sues and the courts end up rejecting his claim, the creditor is simply out of luck and won't be able to lawfully force your employer to give him money. If, however, the court enters a judgement against you and the creditor prevails, the court can then direct your employer to set aside a certain amount of your paycheck each week and send it to the creditor until the debt is resolved. In legal terms, this is known as wage garnishment or a wage attachment.

It is not the goal of the courts to strip you of all your money so that you become destitute. And that is why there are Federal and state limits as to how much money can be taken from your paycheck. The federal limit is the lessor of 25% of your weekly paycheck or a calculated formula comparing the dollar amount of your weekly paycheck minus 30 times the minimum hourly income. In addition to federal wage attachment laws, all states have their individual laws. These laws, however, must provide at least the protection to the debtor that the federal laws provide.

In fact, some states have enacted significantly tougher wage garnishment rules on creditors than the federal laws do. These laws may either add additional barriers that the creditor has to overcome if they want the courts to rule in their favor. Or, the laws may limit further the amount that can be deducted from the debtors paycheck. What this means in practical terms is that a creditor bringing a suit against a creditor in Minnesota can expect different results than a creditor filing a lawsuit in Alabama.

A number of employees are needlessly afraid of wage garnishments. Yes, it is embarrassing. But, primarily they are afraid of being fired by their employer when their employer discovers that a creditor has sued them for money. But, the federal law explicitly prevents an employer from firing you due to a wage garnishment. If an employer does fire you, however, you will have a legitimate criminal lawsuit to bring against your employer.

Now, to be sure, the fact that their wages are being garnished can be embarrassing for the debtor. But, in a society where debt is such a large part of nearly all financial transactions, it is a necessary tool that allows creditors to be repaid what they are legitimately owed.

POST COMMENT

Vikings Throttle credit rating cards Out previous your Gate, Arizona cannot Recover Bad Credit Unsecured Loans - A Help In Bad Times Personal Loans For Bad Credit - Bad Credit No Longer A Concern Low Income Payday Loans - For Those With Bad Credit Status Bad Credit Personal Loans - Grab Money Inspite Of Stained Credit Score Instant Loans No Credit Check Instant Funds For People With Poor Credit Unsecured loans for bad credit-For the people with bad credits Free Credit Report And Score – Lucrative Provision 3 Month Payday Loans No Credit Checks - Now Poor Credit Not an Issue for Advance Bad Credit Payday Loans - One Payday Loans To Fulfil Several Of Your Needs Only In One Go. Bad Credit Loans: Avail Such Advances To Overcome Your Financial Trouble No Credit Check Loans - Good Idea For Bad Creditors Personal loan for very bad credit: A viable monetary option