How to Prevent Wage Garnishment

Editor at SoloSuit
Hannah Locklear, BA

Hannah Locklear is SoloSuit’s Marketing and Impact Manager. With an educational background in Linguistics, Spanish, and International Development from Brigham Young University, Hannah has also worked as a legal support specialist for several years.

Summary: If you’ve been sued for debt, you can prevent wage garnishment by responding to your lawsuit, settling your debt, consolidating your debts, checking for garnishment exemptions, and using bankruptcy as your last resort. SoloSuit can help you respond to a debt lawsuit and settle your debt before your court date.

Financial stability is essential for maintaining a healthy and stress-free life. However, unexpected financial setbacks or debts can sometimes lead to wage garnishment, a process in which a portion of your earnings is withheld to repay creditors.

Wage garnishment can be a distressing experience, impacting your financial stability and peace of mind. Fortunately, there are steps you can take to prevent wage garnishment and manage your debt effectively.

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How does wage garnishment work?

Wage garnishment is a legal mechanism that allows creditors to collect on debts by directly deducting a portion of your wages. This can be a challenging experience, as it impacts your take-home pay and financial stability. Common reasons for wage garnishment include unpaid taxes, child support, student loans, and credit card debt.

That being said, wage garnishment can result from various types of debts, such as unpaid medical bills or other outstanding consumer debts. Creditors typically initiate the garnishment process by filing a lawsuit against you. If you fail to respond, the court may issue a default judgment in favor of the creditor, allowing them to garnish your wages. However, you have the right to respond to the lawsuit, and doing so promptly is crucial.

Follow these 5 steps to prevent wage garnishment

If you’ve been sued for debt, you still have options. Below, we’ll cover five steps you can take to avoid wage garnishment.

Step 1: Respond to your debt lawsuit before the deadline

Most wage garnishments happen as a result of losing a debt lawsuit, and most debt lawsuits end in default judgment when the defendant (the person getting sued) fails to respond to the case before their state’s deadline.

Finding a lawyer is expensive, and most people facing a debt lawsuit don’t have the funds to hire an attorney to represent them. Luckily, SoloSuit exists to make it easier for you to represent yourself in court and increase the chances of winning your debt lawsuit.

When you get sued for debt, you’ll receive court papers, typically known as the Summons and Complaint, that notify you of the lawsuit and outline the specific claims against you. It’s your responsibility to respond to the Summons and Complaint with a written Answer. With SoloSuit’s software, you can draft and file an Answer to your debt lawsuit in minutes.

In your Answer, you will include the following:

Responses to each claim

You should include an individual response to each claim listed against you in your court document. To respond, you can admit or deny the claim. You can also claim lack of knowledge. Most attorneys recommend denying as many claims as possible to present a strong case. Plus, when you deny a claim, the opposing party has to prove that it’s true, and if they don’t have proper evidence to do so, their case just got more complicated.

Affirmative defenses

An affirmative defense is any reason why you should not be held liable for the debt. For example, if your debt has passed the statute of limitations, or if you’ve already paid of some or all of it, these would be good defenses to bring up in your Answer.

SoloSuit’s software helps you respond to each claim against you, assert your affirmative defenses, and file your case with the court. To learn more about how to draft an Answer to your debt lawsuit, check out this video:

Step 2: Settle your debt before going to court

Dealing with debt can be overwhelming, but settling the debt before your court date can save you from the hassle of a trial and potential wage garnishment.

Debt settlement involves negotiating with a creditor to pay off a debt for less than the total amount owed, and it’s typically pursued by individuals who are struggling to manage their debts and are unable to make full payments.

For example, if you owe a credit card debt and you don’t have the means to pay off the full amount, you could consider negotiating with your creditor to make a lump-sum payment of around 60% of the original amount to settle the debt.

SoloSettle, powered by SoloSuit, is a tech-based approach to debt settlement. Our software helps you send and receive settlement offers until you reach an agreement with the collector. Once an agreement is reached, we’ll help you manage the settlement documentation and transfer your payment to the creditor or debt collector, helping you keep your financial information private and secure.

To learn more about how to prevent wage garnishment through debt settlement, check out this video:

Step 3: Consolidate your debts

Debt consolidation involves combining multiple debts into a single, manageable loan. This can lower your monthly payments and streamline your debt repayment process. Here are some debt consolidation method you might consider:

Personal Loan: You can apply for a personal loan from a bank, credit union, or online lender. If approved, you'll receive a lump sum of money that you can use to pay off your existing debts. Then, you'll make monthly payments on the new loan.
Balance Transfer: This involves transferring high-interest credit card balances to a new credit card with a lower or 0% introductory interest rate. There's usually a balance transfer fee, and the introductory rate is temporary.
Home Equity Loan or HELOC: If you're a homeowner, you can use the equity in your home to secure a loan at a potentially lower interest rate. This is riskier, as your home is used as collateral.
Debt Management Plan (DMP): Through a credit counseling agency, you work out a plan to pay off your debts over an extended period. The agency negotiates with creditors for potentially lower interest rates and fees.
Debt Consolidation Loan: Some lenders offer specialized loans specifically for debt consolidation.

It's important to carefully consider the pros and cons of debt consolidation and choose a method that aligns with your financial situation and goals. With debt consolidation, you'll only have one payment to manage, and it will typically come with a lower interest rate, saving you money on interest payments.However, Some consolidation methods might extend your repayment period, potentially resulting in higher overall interest costs. Plus, consolidation can impact your credit score in the short term, although it might improve as you make consistent payments.

Step 4: Check for garnishment exemptions

In some cases, certain sources of income might be exempt from wage garnishment. Social Security benefits, disability payments, and retirement funds are typically protected from creditors.

Each state has different wage garnishment laws, requirements, and exemptions. However, certain types of income are generally protected from wage garnishment, such as:

Disability benefits
Social Security
Child support
Alimony

Familiarize yourself with the laws in your jurisdiction to understand which sources of income are exempt from garnishment. Here’s a list of wage garnishment laws for each state.

Step 5: Consider bankruptcy as a last resort

While it's generally advisable to explore other options first, bankruptcy can be a last resort for preventing wage garnishment. Filing for bankruptcy initiates an automatic stay, which halts collection activities, including wage garnishment. However, bankruptcy should be carefully considered due to its long-term impact on your credit.

The bottom line

Facing the prospect of wage garnishment can be stressful, but you don't have to navigate it alone. Utilizing tools like SoloSuit and SoloSettle empowers you to respond to debt lawsuits effectively and negotiate settlements that work for you.

By taking proactive steps to address your debt, you're regaining control of your finances and working towards a brighter financial future. Remember, every individual's situation is unique, so it's best to consult with legal professionals or financial advisors to make informed decisions tailored to your circumstances.

What is SoloSuit?

SoloSuit makes it easy to fight debt collectors.

You can use SoloSuit to respond to a debt lawsuit, to send letters to collectors, and even to settle a debt.

SoloSuit's Answer service is a step-by-step web-app that asks you all the necessary questions to complete your Answer. Upon completion, we'll have an attorney review your document and we'll file it for you.

>>Read the FastCompany article: Debt Lawsuits Are Complicated: This Website Makes Them Simpler To Navigate

>>Read the NPR story on SoloSuit. (We can help you in all 50 states.)

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