What Is "Slow Pay" in Tennessee?

If a creditor is garnishing or is threatening to garnish your wages, Tennessee's "Slow Pay" process allows you to stop the garnishment and set up a payment plan you can afford. (Learn about your rights if your wages are garnished.)

Tennessee's Slow Pay Plans

A creditor who sues you and gets a judgment against you is called a "judgment creditor." Judgment creditors can have the court issue a garnishment to your employer, which means that your employer is required to send part of your wages every pay period to the judgment creditor, until the judgment is paid off. Judgment creditors in Tennessee can take up to 25% of each paycheck through a wage garnishment. (Learn more about wage garnishment in Tennessee.) Losing 25% of your income can make it difficult or impossible to make ends meet.

Fortunately, Tennessee residents have another option: file a "Slow Pay" motion. Section 26-2-216 of the Tennessee Code establishes a process known in Tennessee as "Slow Pay." That section says that if you do not have any way to pay off a judgment against you other than your wages, you may set up an affordable payment plan through the court that issued the judgment.

Who Qualifies For Slow Pay?

To qualify for Slow Pay, you must not have any assets, other than your wages, that could be used to pay off the judgment. "Assets" means money or property that is not exempt under Tennessee's exemptions. (Find out what property is exempt in Tennessee. ) If you have non-exempt assets, the judge may deny your Slow Pay motion.

How Does the Slow Pay Process Work?

You will need to file a Slow Pay motion in the court where the judgment was entered. In your motion, you must include the payment amount and frequency (e.g., monthly, biweekly) that you are proposing to pay on the judgment.

You must attach an affidavit to the motion listing your income from all sources, all of your assets, all of your claimed exemptions, all of your debts, and all of your monthly expenses. Some clerks' offices will have a specific form for you to fill out. Depending on the court, you may also need to provide documentation of your income and expenses, such as pay stubs, tax returns, bank statements, or copies of bills.

The motion will be set for hearing. You will need to attend the hearing. Be sure to bring any documentation that you might need with you to the hearing. At the hearing, the judge will review your proposal and will enter an order directing you to make payments. The order will include how much to pay, how often to make payments, and where to send each payment. Once the order is entered, the judgment creditor must honor the terms of your payment plan and can't proceed with a wage garnishment against you.

Here are a few things to keep in mind when considering Slow Pay:

Only one Slow Pay per case. You can only file a Slow Pay motion once in each case. If you miss a payment, the wage garnishment will be reinstated and you can't file another Slow Pay motion to stop the garnishment. This is true even if you lose your job or change jobs. For example, if your Slow Pay order was vacated because you lost your job, and later you get another job, the judgment creditor can garnish your wages at the new job, and you can't file another Slow Pay motion to stop the garnishment.

Slow Pay only applies to wage garnishment. A Slow Pay motion stops a wage garnishment and allows you to pay off a judgment in payments smaller than 25% of your paycheck. However, the Slow Pay process only applies to wage garnishments. For example, a Slow Pay motion cannot stop a creditor from repossessing a car, furniture, or other personal property.

How Much Will My Payment Be?

Here's what the court will consider in setting your payment amount.

Post-judgment interest plus some principal. Your proposed payments must be, at minimum, enough to pay any post-judgment interest that is accruing (most judgments in Tennessee include post-judgment interest at the rate of 10%) and some portion of the principal. If you propose to pay less than this, the judge may deny your Slow Pay motion.

An amount you can afford. Also, your proposed payments must be an amount you can actually afford. If your income and expense affidavit and documentation show that you can't reasonably afford to make your proposed payments, the judge may deny your Slow Pay motion.

Good-faith effort. Finally, your proposed payment must represent a good-faith effort on your part to pay off your judgment. For example, if your income and expense documents show that you can easily afford to pay $500 per month, but you are only proposing to pay $100 per month, the judge may deny your Slow Pay motion.

When Can I File a Slow Pay Motion?

You can file a Slow Pay Motion at any time if you think that the judgment creditor may attempt a wage garnishment. You do not need to wait until the garnishment has been sent to your employer. You can also file a Slow Pay motion after the garnishment starts, even if the garnishment has been in place for a long time and you have already made payments on the judgment. (If you have been paying 25% of your wages for a long time before you file your Slow Pay motion, you may have to explain to the judge how your circumstances have changed--maybe your expenses have increased or your income has decreased--so that you can't afford the wage garnishment anymore.)

What Happens If I Miss a Payment?

Once the judge enters the order setting up your installment payments, you should be very careful to make the payments in full and on time. If you miss a payment, even if you have never missed a payment before, the judge will vacate the order allowing installment payments. This means that the Slow Pay order will no longer be effective and the wage garnishment will be reinstated.

What If I Lose My Job or Change Jobs?

If you change jobs, Tennessee law requires you to notify the judgment creditor of your new employment information within ten days of starting your new job. If you are making less money and can't afford your current payment, you can file a motion to review the installment payments. You can also request a review if you are making more money and want to pay more than your current installment payment (so that you don't have to pay as much in interest over the course of the payment plan). You can request a review as often as once every six months. At the review hearing, you can explain to the judge how your circumstances have changed and request a change in your payment amount.

If you lose your job or your income decreases so much that you cannot afford the minimum allowable payments, the judge will likely vacate the order allowing the installment payments. You may want to consider filing for bankruptcy. (To determine which is better in your situation, Slow Pay or bankruptcy, see Should I Do Slow Pay or File for Bankruptcy?)

Can I Enter Into a Slow Pay Plan If My Only Income Is Social Security?

If a creditor gets a judgment against you, and your only income is Social Security (or a similarly protected income source), you may choose to use the Slow Pay process to pay off the judgment. Keep in mind, however, that Social Security is exempt income and is not subject to garnishment. (Learn more about what types of income are exempt from collection by creditors.) The only way a judgment creditor can get your money is if you voluntarily set up a Slow Pay installment plan. If you do set up a voluntary Slow Pay plan, you have not waived your Social Security exemption.