Can Credit Card Companies Garnish Wages? Wage garnishment is something that people do not want to see in their life and they hope not to be a victim. I always see that too many people are walking around own credit card debt and other forms of debt that they are yet to pay.
After a credit card company has made a fort for an individual to pay their debt and they refuse the account usually goes to the collections department. But the question we are here to answer is this Can credit card companies garnish wages?
After the credit card company has sent your debt to the credit collector department and you still refuse to pay your bills. You are definitely going to get summoned and sued to court. If you are summoned what can be the worst outcome that you will have if you still do not pay your bills? This is what will take us to this article today to answer if your wages can be garnished by a credit card company.
What is Wage Garnishment?
If you are a creditor you are in the business of making money which means that you will not take it lightly when a debtor refuses to pay their debt. It is always frustrating when creditors try to collect on a debt that borrowers are owing but to no avail. This is when a credit if we decide to send a particular date to a debt collection department.
When all efforts to collect the money you owe the credit card company by the debit collector fail your account will be sent to the court so that you can be summoned. If you did not properly settle the lawsuit and it proceeds and the court rules in favour of the debt collector then your wages will get garnished.
This means every month a portion of your wages will automatically go towards paying for the debt. This is what wage garnishment means. It is when the court approves that a portion of your wage should automatically go to paying off your debt.
Can Credit Card Companies Garnish Wages?
The answer to this question is very big, yes your wages can be garnished by a credit card company if you are owing credit card debt and you refused to pay. After all, the effort has been made for you to pay back your credit card debt like increasing your interest rate or sending your debt to a debt collector and you still refused to pay it at this point you get sued.
When you are sued and you did not handle it properly and the court or the judge ends up ruling in favour of the credit card company then your wages will be garnished. Wage garnishment is often associated with unpaid child support, defaulted student loans or back taxes but can also be done to someone that says to pay credit card debt.
When can Credit Card Companies Garnish my Wages?
Applying for a credit card and getting approved means that you have entered into a legal contract that you will make regular monthly payments for the card. So when you fail to make a payment you are breaking that contract and your credit or is at liberty to demand payment when you refuse to send your account to The Collector.
If you still refused to pay and all effort has been made by the collections department to collect on the debt that you owe they can decide to pursue legal action against you. It is at this point if you still do not pay your credit card debt you will get sued to court and then your wages will be garnished. But just as I have mentioned your wages can only be garnished if the court rules in favour of the credit card company.
What are the Wage Garnishment Limitations?
For an ordinary garnishment, creditors are not allowed to take more than 25% of your income after tax deductions and other necessary deductions have been made. If you are receiving payment weekly and your disposable income is $217.50 ($7.25 × 30) you cannot be garnished because your income is too low. When your disposable income is more than $217.50 but less than $290 ($7.25 × 40), the amount above $217.50 can be garnished.
These are some of the limitations in which you will not pee or you cannot have your ways garnished. It is also important to note that wage garnishment law is different from state to state. Some state has stricter wage garnishment rooms while some state has less strict rules for wage garnishments.
How to Protect Yourself From Wage Garnishment
One thing is certain ignoring your credit card company will not make your credit card debt go away it will only if you read them and make your wages garnished. And as usual, they accept ways you can use to protect yourself against wage garnishment some of which are listed below.
- Not paying the debt is not an option so you need to ask your creditor for a payment plan that will be comfortable enough for you to make payments slowly.
- You can also decide to make a lump sum payment for a reduced fee so that the remainder of the dead Can Be forgiven.
- Contact your creditors about a debt forgiveness plan that is if they are willing to offer one.
- Finally considered debt consolidation.
These are some of the ways you can use in protecting yourself from wage garnishment.
Wage Garnishment FAQs
What are the most a creditor can garnish?
A creditor can garnish up to 60% of your disposable income if you are not supporting a child or spouse. Anybody supporting a child or a spouse can receive garnishment of up to 50%. In addition to the 60% garnishment fee, an additional 5% can also be garnished if your monthly payments are more than 12 months in arrears.
How can I get rid of credit card debt without paying?
There is no way to get out of a credit card debt without paying it if you do not file for bankruptcy. Filing for bankruptcy is not as easy as you think because there are certain things involved.
When you file for bankruptcy you have to collect the claim that you no longer have any money so the creditor will leave you alone. But you should consider the negative effects of filing for bankruptcy before doing so.