Will filing bankruptcy stop a garnishment by a creditor?

Will filing bankruptcy stop a garnishment by a creditor?

garnishmentThis is a great question, especially when you’re dealing with creditors.

Let’s look at this.

Yes, it will.

Filing bankruptcy will stop or “stay” a garnishment of your paycheck or bank account by most creditors.

Garnishments for credit card debt, medical bills, deficiencies from a vehicle that was picked up or home that was foreclosed upon, and most other non-priority debt garnishments will be stayed with the filing of a bankruptcy.

Once the company garnishing your paycheck or bank account receives notice of your bankruptcy filing, the garnishment will stop.

This is part of the “automatic stay” that protects you while your bankruptcy case is pending.

The next question is will the garnishment permanently stop the garnishment?

This depends on whether you get a discharge of the debt.  The debt that led to the garnishment in the first place.

Here’s a general rule:  typical consumer debt can be discharged.  Student loans?  Very hard.

A discharge means you no longer owe the debt and no one can ever collect against you for the debt.  If someone does, then look into suing them!

So if the debt is discharged, then there is nothing to garnish.  When there is nothing to garnish, the garnishment can never happen.

But if the debt is not discharged, then after the “automatic stay” is lifted (goes away), then the garnishment may start up again.

So you’ll need to ask your bankruptcy lawyer not only will the taking of your money be temporarily stopped.  But will it be permanently stopped also?

Contact Us.

If you have any questions about what we’ve talked about in this video, and you live in Alabama you can give us a call at 1-205-879-2447.

You can also check out our other articles about bankruptcy here. 

Or you can fill out a contact form and we will get in touch with you as soon as possible.

I look forward to chatting with you!

Have a great day, and thanks for reading.

-John G. Watts

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