When a bankruptcy is filed, an automatic stay immediately goes into effect. This stops virtually all collection activity against the debtor. If a wage garnishment has been initiated, it now must stop. While it is always better to file the bankruptcy before any wage garnishment goes into effect, it often happens that the wage garnishment itself is what caused the debtor to finally seek bankruptcy protection. Once the bankruptcy is filed, the garnishment ceases immediately. It does not matter that the creditor doing the garnishment has obtained a judgment. That debt will be treated through the bankruptcy process regardless of whether or not it has been reduced to judgment.
In many situations, where a debtor has been garnished prior to the bankruptcy filing, the debtor’s lawyer is able to recover some or all of the debtor’s wages that have already been lost to garnishment. This is because laws that help bankruptcy trustees recover property for creditors can also be used to help the debtor. A skilled bankruptcy attorney will be well versed in these laws.
At the Bankruptcy Law Center LLP, we are very familiar with all of the bankruptcy laws. We routinely will review any potential client’s situation to see if they are eligible to recover amounts garnished. We will properly time the filing of the bankruptcy to make sure that client is eligible to recover the maximum amount allowable. If you reside in Dodge, Kenosha, Ozaukee, Milwaukee, Racine, Sheboygan, Walworth, Washington, or Waukesha County and are facing an imminent garnishment or are already being garnished, feel free to contact the experienced attorneys at the Bankruptcy Law Center LLP at (414) 257-1900 for immediate assistance.