St. Petersburg Wage Garnishment Attorney
Protecting Paychecks Pinellas County
When you are struggling to keep up with mounting bills, the last thing you need is any loss of income. Unfortunately, creditors can potentially take up to a quarter of your weekly disposable earnings when you fall behind on making payments.
At Charles G. Moore PA, we help clients stop ongoing or pending wage garnishments through bankruptcy. We have 30+ years of legal experience and have filed thousands of Chapter 7 and Chapter 13 cases. We are determined to provide the guidance you need to navigate this difficult time, and our team will work tirelessly to help you overcome whatever financial difficulties you face.
How Wage Garnishments Work in Florida
When a creditor “garnishes” your wages, they force your employer to send a portion of your paycheck directly to them. These funds go toward settling the outstanding debt, and the garnishment will generally continue until the debt is paid.
Most creditors cannot immediately or automatically garnish your wages. In most cases, creditors will need to obtain a court judgment before they can take any of your earnings. A creditor can procure a judgment by winning a collections lawsuit filed against you. Once a creditor has a money judgment, your employer will be obligated to comply with its terms.
For example, say you fall seriously behind on paying your medical bills. You are unable to reach a settlement with the medical provider’s billing department, and they determine you are unlikely to pay what you owe. The medical provider may sell your debt to a collection agency, or they may choose to file a collection lawsuit themselves. In either case, if you legitimately owe the debt, you are likely to lose the lawsuit. The claimant will be able to procure a money judgment and begin garnishing your wages. However, you will have ample notice that a wage garnishment might be coming and will therefore have time to act.
If you owe court-ordered child support or unpaid income taxes, your creditors may be able to garnish your wages without first obtaining a money judgment. You may also be vulnerable to expedited wage garnishment if you defaulted on your federal student loans. In these situations, the government or your ex-spouse does not have to sue you in order to initiate a wage garnishment.
No matter your circumstances, creditors cannot siphon off the entirety of your earnings. Under federal law, creditors can only garnish a fixed percentage of your wages.
Most creditors can only garnish 25% of your disposable income. The keyword here is “disposable.” Your disposable income refers to your “take-home” pay, or the amount that is left over after your employer makes all required deductions. Keep in mind that deductions that are not required by law, such as deductions for health insurance or union dues, do not factor into calculating your disposable income.
If you primarily support a child or another dependent, you may qualify for Florida’s “head of family” wage garnishment exemption. The head of family exemption prevents many types of creditors from garnishing your wages, even if you owe debts. You must proactively request this form of relief when you are informed a creditor will seek a wage garnishment.
Wage garnishments involving student loans, unpaid taxes, and missed child support payments have different limits. If you have defaulted on your student loans, the government can garnish up to 15% of your disposable income or up to 30 times the minimum wage, whichever is lower. The amount the government will garnish when you owe unpaid income taxes will vary depending on how many dependents you have and the accompanying deduction rate.
Falling behind on child support payments can result in especially serious wage garnishments. Your ex-spouse can garnish up to 60% of your disposable income if you are not currently supporting a spouse or child. They can still garnish up to 50% of your disposable earnings if you are supporting a spouse or child that is not named in the child support order. An extra 5% can be tacked on if you are more than 12 weeks behind in making payments.
Multiple simultaneous wage garnishments can potentially jeopardize your employment, as your employer is allowed to fire you instead of facilitating compliance with several orders. Our office is determined to help you avoid this scenario and stop these orders before they start.
How Filing for Bankruptcy Stops Wage Garnishments
A wage garnishment, will in most cases, continue unless you take action to stop it or the associated debt is paid in full. Filing for Chapter 7 or Chapter 13 bankruptcy triggers the automatic stay, a court order that halts all collection actions – including collection lawsuits and wage garnishments.
In other words, when you file for bankruptcy, all wage garnishments must immediately cease. If your creditor was in the process of suing you or obtaining a money judgment, they cannot continue without special permission from the Bankruptcy Court or until the stay is lifted.
Bankruptcy can also give you the tools and relief you need to eliminate debt and reorganize your finances. In a Chapter 7 bankruptcy, you will liquidate non-exempt assets but pay nothing. This approach can be great for individuals with little to no current income. If you do have a steady stream of income, Chapter 13 bankruptcy allows you to repay a portion of your debts over several years. At the end of either process, you will generally be allowed to discharge any remaining unsecured debt, including credit card debt and medical debt.
We are ready to help you make the most of bankruptcy and fight for a future free of crushing debt. If you are struggling with wage garnishments, our firm will work with you to explore your bankruptcy options and help you understand how the process works. Once you are ready to file, we will ensure all garnishments stop and provide the capable representation you deserve every step of the way.
Frequently Asked Questions
Which Type of Bankruptcy Is Right for Me?
There are two major types of consumer bankruptcy: Chapter 7 bankruptcy and Chapter 13 bankruptcy. Chapter 7 is intended for people with limited income, while Chapter 13 is meant for people with regular income but are unable to meet their current obligations.
To determine your eligibility, you will need to complete the Means Test. Compare your current monthly income to Florida’s average median income for your household size. If your income is less than the state average, you “pass” the Means Test and qualify for Chapter 7 bankruptcy. If your income is greater than the state average, you will likely need to file for Chapter 13 bankruptcy if you have considerable disposable income each month.
We also recognize that bankruptcy is not necessarily right for everyone. It is important to have a full understanding of what property you can expect to keep, what debts can be discharged, and any other potential impacts and consequences that might result from your filing. Our lawyer will thoroughly review your situation and give you straightforward advice.
What Types of Debts Can I Wipe Out through Bankruptcy?
Completing a Chapter 7 or Chapter 13 generally allows filers to discharge nearly all of their unsecured debts without penalty. Unsecured debts are issued based on your creditworthiness and do not have collateral backing.
Bankruptcy can typically eliminate:
- Credit card debt
- Medical debt
- Gambling debt
- Signature loans
- Mortgage deficiencies
- Certain types of tax debt
You cannot discharge all types of debt through bankruptcy. While you may be able to discharge secured debts, which are backed by collateral, you will likely lose secured assets in the process. In other words, while you may theoretically be able to discharge a mortgage, for example, doing so will result in you losing your home. Additionally, you cannot discharge newer income tax debt, student loan debt, child support, or spousal support.
Will I Lose All of My Assets If I File for Bankruptcy?
No. There is a pervasive myth that you will be left with nothing if you file for bankruptcy. Though Chapter 7 bankruptcy does involve a liquidation process, only non-exempt assets will be sold to compensate creditors. You get to keep any exempt assets, and the state of Florida allows you to protect the equity in your home, a certain amount of equity in your vehicle, most of your personal property, and other essential assets. Strategic use of exemptions can result in your losing little to nothing.
Chapter 13 bankruptcy involves no liquidation process whatsoever. Within certain guidelines, you will be able to keep all of your property. This type of bankruptcy can be a great choice for filers with non-exempt assets they wish to keep.
Can Filing for Bankruptcy Save My Home?
Yes. Filing for bankruptcy immediately stops foreclosure proceedings thanks to the automatic stay, a court order that halts nearly all collection efforts. However, you must file before your home has been sold.
If you hope to keep your home, Chapter 13 bankruptcy can provide you the time and relief you need to catch up on payments. Your repayment plan must prioritize mortgage arrears over unsecured debts, so you will be able to devote more of your disposable income to bring your mortgage current. You will also usually be able to eliminate unsecured debts once you have made all plan payments, which can give you the additional financial flexibility you need to stay on top of your mortgage in the future.