What to do if faced with garnishment in New Jersey

If you are facing wage garnishment in New Jersey, you have options on avoiding the process completely.

If you have ever become delinquent on your bills, you know that one of the things that you have to worry about is wage garnishment. Garnishment is an order from the court directed towards your employer, which orders a portion of your wages to be set aside for the benefit of your creditors. If you are currently being threatened with garnishment, you may feel like there is nothing you can do. However, the good news is that garnishment is a process that can be completely avoided, if you understand how it works and your legal options to stop it.

When can garnishment occur?

In New Jersey, like every other state, creditors cannot begin garnishing your wages without you knowing about it well in advance, in most cases. In order to garnish your wages, a creditor must first file a lawsuit against you, prevail on it and obtain a judgment against you. Once the court grants the judgment, the creditor can then take steps to garnish your wages. Since this process cannot happen overnight, you have plenty of time to take action to avoid the garnishment.

However, there are instances where creditors do not first have to obtain a judgment to begin garnishing your wages. If you owe income taxes, child support or student loans, for example, a judgment is not necessary to begin the garnishment process.

Garnishment limitations

Fortunately, creditors cannot take all of your wages. New Jersey law limits the amount that may be garnished from your wages to the lesser of:

• 10 percent of your disposable earnings (what is left over after deductions for social security), provided that your earnings are less than 250 percent of the federal poverty level (if you earnings are above this amount, 25 percent may be taken); or

• The amount that your earnings exceed 30 times the federal minimum wage

There are also limits in cases where more than one creditor sues you and obtains an order for garnishment. Under New Jersey law, only one creditor may garnish your wages at a time. Once that debt is paid, the second creditor may begin garnishing your wages.

How to avoid garnishment

Since garnishment can put you in an embarrassing position with your employer, many people desire to avoid the process. One way of doing this is by working out a repayment plan with the creditor. However, this does not always work, as creditors are under no legal obligation to negotiate a deal with you.

If you are unable to work out a plan (or cannot afford to make the payments), most of the time, the best way of avoiding garnishment is to file bankruptcy. Regardless of the type of bankruptcy you file, you will receive the protection of the automatic stay, which immediately stops garnishment in its tracks. This protection continues throughout the bankruptcy process, as most of your debts are eliminated. Once you have completed bankruptcy, you start over again financially, free of most of the debts that you had before you filed.

If you are facing the possibility of garnishment, it is important to seek the advice of the experienced bankruptcy attorneys at Goldman & Beslow, LLC. Our attorneys can advise you on the best way to rid yourself of your debt, allowing you to begin your life again financially.