What percentage of my wages can creditors take?
By Tony Arnest
Question:
This
is a question I hear often: I have substantial balances owed to several credit
card companies. If fact, one credit card company has sued me already. If it
wins, how much of my take-home pay can it get? And what about the other
companies? I'm worried that I won't be left with enough money to pay for things
like rent, food, and gas.
Answer:
The
total amount your creditors can take from your wages is generally limited to 25%
of your net pay. That limit applies whether you have one creditor or many.
Remember, however, that each creditor must have a judgment against you to be
able to garnish your wages. If more than one creditor has a judgment, the first
one would garnish your wages, get the 25% until the judgment is paid, and then
cancel the garnishment. Then the second creditor would garnish 25% of your wages
until that judgment was paid. And so on.
If
your income is very low, the creditor may not be allowed to attach the full 25%.
You will need to consult our individual state law on
this.
Before
you lose a variety of lawsuits, you may want to get some help dealing with your
creditors. To find credit and debt counselors in your area, go to the website of
the U.S. Trustee, www.usdoj.gov/ust, and select "Credit
Counseling and Debtor Education." You'll find a list, by location, of counseling
agencies that have been approved by the federal government to advise debtors who
are considering filing for bankruptcy.
Although
you might not be in that position, these agencies have been examined and
approved by the government, which makes it less likely that you'll run into some
of the scam artists that all too often prey on people who are deeply in
debt.
(The
presenter, Tony Arnest, is a licensed attorney in California. He is a debt
relief agency and helps people file for bankruptcy. This information is being provided solely for
educational purposes, and is not intended to offer legal advice or serve as a
solicitation for business in anyway.)
I'm having debt problems - What percentage of my wages can creditors
take?
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