Denver Bankruptcy Law | Butler, Landrum & Pierce: Denver Bankruptcy Lawyers

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Bankruptcy Law Practice in Denver and the following areas

Bankruptcy and garnishment of wages

Garnishment of wages is a collection tool used by creditors, which requires a court order to initiate. This court order allows the creditor(s) to collect the debt owed from the debtors’ employer via the employee’s paycheck.

Wage garnishment can be embarrassing to debtors, as the employer becomes aware of the financial situation of the employee. When you are faced with this type of legal action, you should contact an attorney immediately. You have rights under the law, which protect you.

Garnishments can be stopped with a bankruptcy filing. Once your case is filed, creditors are no longer entitled to garnish your wages or other sources of money or income, for any debts which existed as of the date of your filing. The only exemptions to this may be child or family support ordered by a court.

When you file for bankruptcy there is an automatic stay, which prohibits garnishments from proceeding. In addition to stopping garnishments, the automatic stay prohibits law suits, collection calls, repossessions, foreclosure sales and levies. This automatic stay remains in effect until a judge lifts the stay or the debtor gets a discharge in bankruptcy proceedings, or the property is no longer property of the estate.

When the debtor gets a discharged via a bankruptcy proceeding, the automatic stay is replaced with a permanent injunction, which prohibits creditors from all of those actions with respect to discharged debts from the time of filing, which the automatic stay prohibited.

If you have a garnishment filed against you in court, contact us to discuss your options, and learn more about your specific case.