What is Wage Garnishment?
A wage garnishment (also called wage attachment or wage withholding) is when a creditor takes money from your paycheck before you receive it. The Massachusetts wage garnishment law protects more of your wages than the federal wage garnishment law.
Can I Stop a Wage Garnishment?
Massachusetts law allows the majority of creditors to just garnish up to 15% of your wages to repay to your debts. Nevertheless, there are some circumstances under which a creditor could garnish more. If a creditor has sued you, and is seeking to garnish, or has already started the garnishing of your wages, you might be able to stop the garnishment and even get some of your garnished wages back by filing bankruptcy, and getting an automatic stay, however, there are certain exceptions that apply.
The Automatic Stay
When you file bankruptcy, an automatic stay immediately starts that prohibits and stops most collection activities by creditors. This means that wage garnishments are additionally halted providing the bankruptcy stay is in effect. Creditors must seek the courts approval to resume collections lift the stay If a creditor wants to resume collection efforts, however, the court will only lift the stay if the creditor has a valid reason for doing so.
Exceptions to the Automatic Stay
There are some exceptions that do apply to the automatic stay. Domestic support obligations such as child support and alimony are unaffected by the automatic stay, and are considered priority obligations. These priority obligations are not permitted in the discharge of a bankruptcy.
What Happens to Wage Garnishments After Bankruptcy?
If you receive a discharge and the principal debt for the wage garnishment was included in the discharge, the creditor cannot resume the garnishment to collect the debt after bankruptcy. If your case gets dismissed without a discharge, then the creditor can continue the wage garnishment after dismissal.
Can I Recover Wages Garnished Prior to Filing Bankruptcy?
In certain situations, you may be able to recover some of your wages that were garnished before bankruptcy, but specific conditions must be met. You may be able to recover back wages garnished within 90-days prior to your bankruptcy filing if they were over $600 in collection, and you have enough exemptions to cover them.