Can a personal bankruptcy stop a wage garnishment?

Ohioans who are facing insurmountable debts face the potential of having their wages garnished. In short a wage garnishment is a court order that instructs an employer to withhold a percentage of the employee's earnings and pay it to the creditor until such time when the debt is fully paid.

Creditors in Ohio cannot take garnish wages without first obtaining a judgment from the court affirming that the money is owed.  However, they are required to provide you with notice that you are being sued - many debtors fail to appear in court because they did not receive notice, only to have a default judgment entered against them.

In addition, if you are being sued and lose the case, a money judgment can be entered against you and the other party can also request a wage garnishment from the court if you fail to pay the judgment. Lastly, wages can be garnished without a court order against those who fail to pay income taxes, court ordered child support, support arrearages as well as for student loan defaults.

Under Federal and state law, creditors cannot garnish more than 25 percent of your disposable earnings or any amount greater than 30 times the minimum wage, whichever is less. In addition, if there is more than one garnishment against you, the total amount that can be garnished is 25 percent. Lastly, the amount that can be garnished for child support and spousal maintenance, student loans, and back taxes differs.

How to stop a wage garnishment?

A wage garnishment can be stopped by filing for personal bankruptcy. This requires careful consideration, however, since bankruptcy can cause long lasting damage to your credit worthiness and prevent you from borrowing money.