Can Credit Card Companies Garnish Your Wages

Can Credit Card Companies Garnish Your
Wages: Advice And Information

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Can Credit Card Companies Garnish Your Wages?

On this page you will find out the facts about credit card companies being able to garnish your wages, and I will also offer advice on how you can try to prevent this happening by tackling credit card debt quickly.

This page is aimed primarily at US residents, but the basic principles are the same for the UK equivalent of wage garnishment, which is an Attachment of Earnings Order. This has the same effect and can be applied for through the courts if you owe more than £50 and are behind with at least one payment. Both Garnishment and Attachment of Earnings refer to the ability to have money deducted directly from your wages to repay a debt.

Can Credit Card Companies Garnish Your Wages:
The Legal Process

For credit card companies to garnish your wages they must first obtain a legal order through the courts. You can rest assured that credit card companies cannot do this without reference to the courts and you will be informed of their planned action if they do apply to garnish your wages. If you are summoned to court with regard to a claim by a credit card company, it is important to attend and defend your case.

The first step in the process is that the credit card companies would have to sue you over the debt and the court would need to make a judgement against you. It is this court judgement against you which then allows the credit card companies to garnish your wages by getting a Writ of Garnishment. An order is served on your employer and they are obliged to implement the garnishment as part of their payroll system.

Can Credit Card Companies Garnish Your Wages:
What The Law Says

Who can have their wages garnished, by how much and for what type of debt, is governed by state and federal laws. Federal law says that the maximum proportion of your disposable income that can be garnished is 25%, but some states set their own maximum limits which are lower than this.

The state laws vary considerably, but Texas, Pennsylvania, North Carolina and South Carolina do not permit wages to be garnished except for very specific things. These include debts related to child support, tax arrears, student loans and court fines. So whether credit card companies can garnish your wages or not depends to a certain extent on where you live.

It is possible for more than one creditor to obtain an order to garnish your wages, and if this happens the process in most states is that they have to wait in line. In other words if you are already up to your limit in terms of how much of your wages can be garnished, the next creditor who obtains an order will have to wait until the current ones are finished.

How To Prevent Credit Card Companies Garnishing Your Wages

Once a credit card company has taken you to court and obtained permission to garnish your wages, it will be very difficult to stop it, but if you genuinely cannot afford the payments that have been ordered because you are not left with enough for basic living costs, it may be possible to challenge the court judgement. To do this you need to apply to the court for a Claim of Exemption, and you will need to be able to prove that you do not have enough to live on because of the garnishment.

By far the best option is to take action before the credit card companies get as far as taking you to court. The best way to do this is to take steps to deal with the debt and make sure the credit card companies are aware that you are taking the debt seriously and trying to rectify the situation.

Do Not Let Credit Card Companies Garnish Your Wages - Act First

It is not difficult to take action to prevent credit card companies from garnishing your wages. You can be on the way to doing changing your situation in a few minutes from now. The best option for you will depend on the exact circumstances you are in, but in general if you have substantial credit card debts to a few different companies, you will be able to get help from a professional company.

Debt Management Plans

For people who have a substantial amount of debt to a few credit card companies, but who have a steady income and could afford to make a reasonable payment towards their debts each month, a debt management plan is probably the most appropriate solution. Seeking help from a debt management company will immediately send a message to the credit card companies that you owe money to that you are taking steps to repay them.

Debt management plans are widely used in both the US and UK to deal with debt and help prevent credit card companies from garnishing your wages. An experienced advisor will negotiate with the credit card companies on your behalf to set up new arrangements for paying back your debts. This usually means paying less in interest and often writing off or reducing some of the other charges that may have been applied to your account.

What this results in is a single more affordable payment that you make each month to the debt management company, instead of having to keep track of all your credit cards. Your debt is more manageable and easier to keep up to date with, so it immediately starts to reduce rather than grow, and you avoid any further penalties or late payment fees.

The best debt management companies have online application forms that you can complete quickly and easily, after which they get back to you to go through your situation in more detail. You can find a list of the most reputable and effective companies on the main Debt Management page of this site:

Go To The List of Recommended Debt Management Companies

Debt Settlement

Debt settlement is a solution that can only work if your situation is very serious. People for whom debt settlement works well are typically struggling to keep up with payments and perhaps considering bankruptcy or facing legal action. Perhaps you could not afford to make the payments that would be required on a debt management plan. If this is your situation, debt settlement could be right for you.

What debt settlement does is provide a way to actually write off a large portion of your credit card debts. Credit card companies will only agree to settle for less than the full debt if they think it is the most they are likely to get, which is why it only works for people who really cannot afford to repay the full amount. If your situation is right, you could write off well over half your debts with a good debt settlement company.

If a company agrees to undertake debt settlement for you, they will begin negotiating with all the credit card companies you owe money to with view to agreeing to settle for a much smaller amount. You stop making any payments to the credit card companies and instead put some money away each month into a new account. This is saved up and used to make the settlement payments as they are agreed.

You need to be careful about which settlement company you use, as you can end up worse off if you use a bad one. There are a few reputable and well established organisations that you can apply to without any obligation and compare what they offer. You will find a list of my recommendations for the best debt settlement companies on the main Debt Settlement page of this site:

Go To The List of Recommended Debt Settlement Companies

UK Residents Should Refer To The IVA Page

Can Credit Card Companies Garnish Your Wages?

Understanding How Wage Garnishment Works

Can Credit Card Companies Garnish YourWages: Advice And Information

Go Straight To List of Recommended:US Debt Management Companies

Go Straight To List of Recommended:US Debt Settlement Companies

Learn How To Negotiate Credit Card Settlements Yourself

Can Credit Card Companies Garnish Your Wages?

Can Credit Card Companies Garnish Your Wages:The Legal Process

Can Credit Card Companies Garnish Your Wages:What The Law Says

How To Prevent Credit Card Companies Garnishing Your Wages

Do Not Let Credit Card Companies Garnish Your Wages - Act First

Debt Management Plans

Debt Settlement

Can Credit Card Companies Garnish Your
Wages: Advice And Information

Go Straight To List of Recommended:
US Debt Management Companies

Go Straight To List of Recommended:
US Debt Settlement Companies

Can Credit Card Companies Garnish Your Wages:
The Legal Process

Can Credit Card Companies Garnish Your Wages:
What The Law Says