Cincinnati residents who are unable to pay their debts may find themselves faced with a lawsuit leading to garnishment of their wages, losing up to 25 percent of disposable earnings. Wage garnishment is a court order that directs your employer to withhold an amount from your pay, give it to creditors, and continue doing so until your debt is paid.
Garnishment can only make your financial situation worse as you struggle to make do with lost wages. In addition, it is an embarrassing situation — your employer is faced with annoying paperwork and now knows you are having financial problems. If you continue to have additional garnishments, it can even cause you to lose your job and get into a deeper financial hole.
Fortunately, there are things you can do if you are faced with wage garnishment, but you should always start by seeking legal advice. The skilled and seasoned Cincinnati, Ohio, bankruptcy attorneys at Fesenmyer Cousino Weinzimmer understand that financial problems can happen to even the most well-intentioned people. We provide free initial consultations for people throughout the Cincinnati area who have gotten into financial difficulty. Contact us by email or call 877-654-5297 (Cincinnati).
Before garnishment can occur, creditors must sue you in court and win a judgment against you that allows garnishment of your wages for past-due amounts, plus interest and late fees. If the judgment is granted, the court will send a demand letter to you requesting payment. If you don’t pay or take steps to stop it, the creditor can not only garnish your wages, but take money from your bank accounts and put liens on your property.
Since you will have to receive advance notice that garnishment is about to take place, you have time to do something about it. According to Ohio law, the demand notice must provide you with information about ways to avoid wage garnishment and the date by which you must respond to the Complaint.
If you do not respond to this Complaint, your employer will have to give you wage garnishment paperwork you must return with either a payment or a calculation showing your total earnings are exempt. If you do not return the paperwork on time, the creditor can then get the order to garnish your pay.
You can ask for a hearing if you disagree with the garnishment. If you lose, your pay and bonus checks will be garnished until the amount of the judgment has been paid off or your circumstances change.
Ohio law limits the maximum garnishment amount to 25 percent of your net take home pay, after paying taxes and other deductions such as child support. Creditors may also look to garnish money from your bank account or other assets. However, they may not garnish the following:
When you receive the demand notice, it is essential to immediately take steps to stop the garnishment before the allowed time window runs out. The Cincinnati bankruptcy attorneys at Fesenmyer Cousino Weinzimmer can help you decide on the actions that are best for you. Possibilities include:
With your demand letter, you will get a “Payment to Avoid Garnishment” form you can fill out if you think you will be able to pay what you owe without formal garnishment. The payment form calculates what your payment will be, and as long as you make payments, wage garnishment proceedings stop. When your debt is paid in full, make sure the creditor files a form with the court stating that the judgment has been satisfied.
You or your attorney can try to negotiate a payment plan that does not involve garnishment. However, many creditors will not negotiate if they think they can get the funds regularly through garnishment. Also, negotiation usually involves providing a lump sum payment, and most people do not have the funds to settle.
You may ask the court to request the appointment of a trustee by filing an affidavit that lists all your creditors, the total amount of each creditor’s claim against you, and the amount you will pay the trustee out of each paycheck.
You have 15 days to file the affidavit with the nearest Municipal or Common Pleas court. The Hamilton County Municipal Court County Government Office is located at 1000 Main St, Cincinnati, OH 45202, Phone: (513) 946-5656.
Once your trustee has been appointed, creditors can no longer garnish your wages as long as you keep making your payments.
A debt counseling service will allow you to pay off your debt over time without having your wages garnished. The counselors will calculate a payment that will be distributed among your creditors and help you build a budget. If a judgement has been entered by a creditor, this option will not likely stop any garnishment.
Eliminate many of your debts and get a fresh start financially.
The most common types of bankruptcy are Chapter 7 and Chapter 13.
Chapter 7 allows you to liquidate any non-exempt assets to pay creditors, and this eliminates remaining debt. Chapter 13 reorganizes your debts and sets up a payment plan monitored by the court and a trustee; it allows you to keep many assets.
Filing bankruptcy will stop all creditor collection efforts against you, including garnishment, foreclosure, vehicle repossession, and utility disconnection. However, you will still be responsible for certain debts, including child support, spousal support obligations, student loans and most unpaid taxes.
Once a bankruptcy case has been filed, any post-petition wage garnishment will be returned to you. In some situations, we can even help you recover wages that were garnished within 90 days before filing for bankruptcy.
If you are faced with garnishment of your wages, time is of the essence. Take the first step by contacting the experienced and compassionate Cincinnati, Ohio, debt-relief attorneys at Fesenmyer Cousino Weinzimmer today for a FREE INITIAL CONSULTATION.
We know what you are going through. We will evaluate your entire financial picture by looking at your income, your debts and your goals, and we will discuss the best fit for your individual situation. We will handle every phase of the process and find what works best for you.
Student loan debt is an ever-increasing problem in the United States and has become the second highest consumer debt category, right behind mortgages. Money owed on student loans has reached $1.5 trillion, and the average…
Credit cards are one of the easiest, but most expensive, ways to borrow. People who don’t pay them off in a timely fashion or only pay the minimum balance often wind up in situations with…
Chapter 7 is the most common form of bankruptcy and has certain advantages, but that doesn’t mean it is the best solution for you. Depending on your situation, Chapter 13 bankruptcy, which allows you to…