If you are the subject of a wage garnishment (also called wage attachment) and cannot afford basic living expenses, you may be able to reduce the amount of wage garnishment or eliminate it altogether. Possible options include filing a claim of exemption, filing for bankruptcy, or vacating the judgment. Read on to learn more about these options.
When Can Creditors Garnish Your Wages?
Most creditors cannot garnish your wages without first getting a money judgment against you. This means the creditor must sue you in court and then either win its case or else get a default judgment (which it gets if you don’t respond to the lawsuit). Some creditors, however, can garnish your wages without a judgment. (To learn more, see Your Rights If Your Wages Are Garnished.)
After the creditor obtains the judgment, it sends documentation to your employer directing your employer to take a certain amount from your wages and send that money directly to the creditor.
Options to Reduce or Eliminate the Wage Garnishment
If you won’t be able to afford basic living expenses for yourself or your family with the wage garnishment, here are some of your options:
File a Claim of Exemption
Your state laws provide you with various protections called exemptions that you may claim to reduce or totally wipe out a garnishment. These exemptions allow you to keep your income based on whether you make a certain amount of money, you provide support to a dependent, or your income falls into a special category such as social security, public assistance, or retirement benefits.
The head of household exemption. Most states offer a Head of Household or Head of Family Exemption. You may claim this exemption if you provide more than 50% of the support for a child or other dependant. This exemption protects all of your wages unless you agree to a wage garnishment in writing.
Limits to the amount of your wages that may be garnished. State law also protects your wages up to a certain percentage. This percentage varies by state but typically ranges from 15% to 25%. However, if you make more than a certain amount, the creditor can garnish all of your wages above that amount. This amount also varies from state to state. (To find out the wage garnishment limits in your state, see our State Wage Garnishment pages.)
Social security and disability cannot be garnished. State and federal law prevent social security benefits and disability benefits from being garnished. Typically, the Social Security Administration rejects a request for garnishment sent to it unless the underlying debt falls into a special category. However, when your funds are deposited into your bank account, the creditor may attempt to seize them. Social security funds retain their protected status for six months even in a bank account. If the creditor successfully seizes those funds, simply file a claim of exemption with the clerk and the judge should direct the creditor to immediately turn those funds over to you.
Complete and File the Claim of Exemption Form with Your County Clerk’s Office. You may obtain the form online or from the clerk’s office itself. Select the appropriate exemption and file the claim with the clerk. The clerk then sets a hearing that you must attend. You should bring to this hearing proof of your income and all expenses so that you can show the judge that you cannot afford basic expenses necessary to live.
File for Bankruptcy
Filing bankruptcy stops wage garnishments. When you file bankruptcy, an automatic stay comes into effect that terminates most types of wage garnishments. Once the case is filed, you need to make sure that both the creditor and the clerk of court receive notice of the filing of the bankruptcy. The type of bankruptcy you file determines the type of long-term relief you receive. (Learn more about how bankruptcy's automatic stay works.)
Chapter 7 bankruptcy. In Chapter 7 bankruptcy, if the bankruptcy court discharges the debt causing the garnishment, then the garnishment is terminated forever. However, certain types of debts survive the Chapter 7 bankruptcy, which means the creditor can continue with the wage garnishment after the bankruptcy. (Learn more about which debts are and are not discharged in bankruptcy.)
Chapter 13 bankruptcy. Although the automatic stay applies in Chapter 13 bankruptcy as well, some bankruptcy courts require that your monthly Chapter 13 payment come directly from your wages.
Vacate (Get Rid of) the Judgment
If you believe that the judgment was obtained improperly, you may file a motion to vacate (get rid of) the judgment. In this request, you should list the reasons why you believe the judgment should be invalidated. There are only certain, specific grounds for vacating a judgment. Check with a local attorney to see if any of the grounds apply in your case.
If the judgment is vacated, the lawsuit doesn’t go away. But you will now have the opportunity to file a response and challenge the lawsuit in court.