Wage Garnishment, Nuts and Bolts

[1mquestion]

Thanks. Yes I did make a new thread and got many replies. There was nothing in writing, but we spoke to our lawyer and we agreed that 25% was fair. We have already paid him and recovered our check. Thanks for your reply.

[bab75]

Thanks for this, very helpful!

[GoingDown]

For those of you reading this forum in Arizona... There is some state specific information you might find useful in this website regarding creditor lawsuits, garnishment, etc...

http://www.arizonarealestatelaw.net/Arizona_Wage_Garnishment_Law,_Stop_Scottsdale_Wage_Garnishment,_Phoenix_Wage_Garnishment_Prevention.html

[slk2198]

How much money can they garnish monthly? Is it a % of your balance. Can they just come in and clean my cking acct out entirely?

[GoingDown]

How much money can they garnish monthly? Is it a % of your balance. Can they just come in and clean my cking acct out entirely?

It depends upon your state exemptions for checking accounts. For example, in Arizona, only $150 is exempt from garnishment by a judgment creditor. So anything above $150 can be seized and given to the judgment creditor up to the amount of the judgment plus attorney fees and court costs, and then the bank will also charge fees for responding to the court order.

Never keep more money in a checking or savings account than you can afford to lose once someone files a lawsuit against you.

[stray]

If you are an independent contractor (1099), will they contact your clients for garnishment? I am paid by the hour and receive a direct deposit from 1 client & paper checks from another. Or will they just go directly to your bank account?

[GoingDown]

They mainly go after ordinary wages and checking/savings accounts.

And yes, they would go directly to your bank and seize the account, or go directly to your employer and garnish the wages.

If they somehow find out that you are working as an independent contractor for the same person over and over again, they might be tempted to do something about it. The less information they get from you, the better. Don't tell them about it.

The direct deposit is in peril.

You might want to read the EXEMPT FUNDS stickie for info about pre-paid debit cards, and maybe having it direct deposited to a pre-paid debit card. Or ask if they can give you a paper check and then go stand in line at the bank and cash it, so the debt collectors can't get their grubby little hands on it.

[treehugger1]

Stray, It might be better if you posted this to the collections thread as a new post. I would move it over for you, but I don't know how to do that.

Before any creditor can act against you they need a judgment against you.

If you are a true contractor, then I believe there are some court precedents in Oregon that did not consider funds earned under an independent contract to be "wages" for the purpose of garnishing a paying client.

A judgment creditor/CA/JDB can do a "till-tap" which in your case would mean garnishing your bank account. Since the funds are not exempt wages, it is my understanding they can garnish 100% of your account.

In my experience, if the judgment creditor/CA is local, they can be quite resourceful in tracking down your bank accounts.

In Oregon, a bank levy is a one-time order. The bank levy is only good for the business day it is received by the bank. This doesn't stop the creditor/CA from issuing bank writs each day, but this can become quite expensive.

This can also get expensive for you as most financial institutions charge a $25 - $100 fee to deal with a levy or other legal matters associated with your account.

If you move to a non-brick-and-mortar bank, it can be difficult to discover these types of accounts (prepaidC1, paypal, etc.) They can be discovered under a debtor examination. But, even then you have plenty of notice of the exam. I live down here in the southern part of the state and I have noticed that many of the regional/local CA's often have debtor exams on the court docket.

You might consider opening a prepaid debit-card account with capitalone,walmart, etc.

Do you currently have a judgment against you or your "business?"

[stray]

Thank you very much GD & tree for all the info.

treehugger, as of now I have a summons and am meeting with attys about BK. I'll know w/in the next 2 wks if I have to deal w/garnishment or not & will start a new thread if I have more questions.

[poorinny]

Moved to own post