If you find yourself falling behind on debt payments, wage garnishment may not be far behind. It is one of the most utilized weapons in a creditor’s collection arsenal. However, if you are like most people, you may not fully understand the intricacies of wage garnishment. What exactly is it and how does it work? Who can garnish wages and how much can they take out of your paycheck? And – the main reason you’re here – you want to know How Long Can Wages Be Garnished? We will explore these questions and more throughout this article.
What Is Wage Garnishment and How Does It Work?
Wage garnishment (or wage attachment) is a court order that allows a creditor to take money directly from your paycheck until a debt is fully paid. Here in Maryland, this is often easy, because the creditor can request what is known as an “affidavit judgment” under Md. Rule 3-306. This allows the creditor to file particular documentation with the court and if the party being sued does not respond, the court can enter a judgment very quickly. And even if the party being sued does respond, many times there is not much of a defense that can be made.
10 days following the judgment, the creditor becomes a judgment creditor and can begin the wage garnishment process. Under Md. Rules 3-646 and 2-646, the judgment creditor must file a Request for Writ of Garnishment in the case, which once issued is served upon the judgment debtor’s last known address. Many times, judgment debtors have not updated their address with the court so they may not even receive a copy of the writ of garnishment so that when the garnishment hits, it is often a surprise. Upon filing, the clerk of the court issues a writ of garnishment directed at the judgment debtor’s employer to be served by the judgment creditor. The employer must file an answer within 30 days and, if the judgment debtor works for the employer, the employer must list the judgment debtor’s rate of pay and the existence of any prior liens.
Who Can Garnish Wages and How Much Can They Take?
There is a long list of people who can come after your paycheck, including credit card creditors, old car loans, old apartment debt, state and local government, the U.S. Department of Education, and the Internal Revenue Service (IRS). The actual amount that a creditor can garnish depends on several factors, including the type of debt, as well as federal and state garnishment limits. You can use this Maryland Wage Garnishment Calculator to find out how much will be taken from your paycheck because of a wage garnishment, typically 25 percent of your disposable wages (what’s left after mandatory deductions).
In the event that you have more than one garnishment, each garnishment must be satisfied in the order in which they were served before the subsequent garnishments can take effect, under Md. Code C.L. § 15-603.
How Long Can Wages Be Garnished?
Every state has different periods of time during which a garnishment judgement can be effective. However, even if the garnishment period ends, the creditor can have it renewed until the debt in question is fully paid. Here in Maryland, a judgment lasts for 12 years, can be renewed for another 12 years, and so on, and accrues interest at 10% per annum. This means that a $5,000 judgment will accrue interest at $500 per year.
Still, if you find yourself faced with a wage garnishment, you are not completely powerless. Filing for bankruptcy stops most types of wage garnishment, at least temporarily. When a person files for bankruptcy, the automatic stay takes effect, which prohibits all collection activities against the individual. This gives the bankruptcy filer, or “debtor,” some breathing room to devise a payment plan or to eliminate the debt altogether. Filing for bankruptcy can stop a foreclosure or auto repossession, aggressive tax collectors and collection calls/letters, wage garnishment, and more.
Talk to a Maryland Bankruptcy Attorney
The best time to stop wage garnishment in Maryland is before it has begun. When the process is already underway, your options are more limited because you will be severely affected with a significantly lower paycheck and may not be able to afford an attorney at that point. So, if you find yourself facing potential wage garnishment, it is important to contact an experienced Maryland bankruptcy attorney to discuss your rights and options. Steiner Law Group is here for you. We are a boutique law firm in Maryland that assists individuals and businesses with bankruptcy and financial restructuring services. We have helped hundreds of individuals, families, and businesses discharge millions in debt, and have extensive experience stopping wage garnishments and even getting back certain garnishments that were taken.
If you have more questions about wage garnishment, Chapter 7 bankruptcy, or Chapter 13 bankruptcy, please schedule a risk-free consultation or contact Steiner Law Group, LLC at (410) 670-7060 to learn more about bankruptcy options.