Q: What is a wage garnishment?
A: If you’ve stopped paying a debt, your creditor could sue you and receive a court order to get that money paid back over time by having your employer garnish your paycheck.
Q: Are there limits on how much can be garnished?
A: The amount of pay that can be garnished is based on the person’s “disposable earnings,” which is the amount of pay left after legally required deductions are made. Federal law sets a maximum amount of pay that can be garnished in any workweek or pay period. Visit this Fact Sheet to learn more about how federal law defines disposable earnings, what the general limitations are on the amount of pay that can be garnished, and how those limits may differ for specific types of debt like child support.
Q: What can I do to avoid my pay being garnished?
A: Consider the following options, though not all of them are going to apply or be possible in any given situation:
- Challenge the garnishment: You should challenge the court judgment ordering the garnishment if the debt doesn’t belong to you or you think the amount is incorrect or invalid. In such cases, pay close attention to the judgment paperwork you receive from the court, and follow the instructions about how to file a challenge and the timeline for doing so.
- File an exemption: You may be eligible to claim that all or some of your income is exempt from garnishment. For example, certain types of income may be exempt, such as alimony, child support, Social Security, retirement and disability income. In this claim, it is important to show how a garnishment would negatively impact your ability to cover necessary expenses and provide for your dependents.
- Pay off the debt: If you do owe the debt, consider contacting the creditor (or collection agency) to settle the debt for less than the amount owed or to set up a modified payment plan based on your ability to pay.
- File for bankruptcy: If your financial situation is bad enough, filing for bankruptcy would stop any existing garnishment activities. If you’re thinking about bankruptcy, though, it’s important to consult with a bankruptcy attorney first to determine if it’s the right move for you.
Q: How will a wage garnishment impact my credit?
A: Unless you can prove that the debt that is the subject of the garnishment does not belong to you, by the time a creditor seeks a judgement to garnish your wages, they have probably already been reporting that the debt is overdue, has been charged off and/or sold to a collection agency. The judgement itself will not appear on your credit report, but the negative statuses of the debt owed will hurt your credit score(s), and stay on your credit report(s) for seven years.
