Help! Garnishment questions, bank info

[FreshLikeADaisy]

They can still take the 25% of his wages which is really going to hurt us.

Oh, I forgot to add: this is the whole point of doing the Claim of Exemption. They may start at 25%, but you claim every possible exemption you can, which has the effect of lowering the percentage they can take. 25% is the starting point. Optimally, after filling out your form and listing all your exemptions, the end point is 0%. In other words, yeah they won their garnishment, and yeah your wages are technically garnished, but the amount they actually take out is $0.00. And it's good for whatever asset they want to garnish as long as you do a separate claim for every separate Writ of Garnishment.

By doing a Claim of Exemption, you're not actually challenging the Writ of Garnishment or saying it is invalid or without cause; you're saying that this portion of your assets are legally exempt from garnishment because of ___, and that portion is exempt because of ___, and so on. Think of the exemptions on your income tax: you exempt this amount for one dependent, that amount because you're blind, etc. Those exemptions cannot be taxed, and have the effect of lowering your total taxable income. This is the same principle, if that makes sense: instead of having less taxable income, you have less garnishable income (or assets, or whatever).

Wherever they do a garnishment, you do a Claim of Exemption. Today they want to garnish the bank account; okay, you do a Claim of Exemption for that. Tomorrow, they want to garnish his wages; okay, tomorrow you do another Claim for that. Apparently whenever there's a Writ of Garnishment, there's another Claim of Exemption form you fill out. You just use the same exemptions over and over again, and keep filling out the form the same each time.

I'm not an attorney, so don't take this as the last word, but that is my understanding of this process. You may come out of this with every creditor awarded a garnishment, and yet 100% of your wages and bank account balances intact. Take a good hard look at that page of possible exemptions listed in that PDF brochure, and note each one that even remotely applies to you, and list it as instructed. Again, just like taxes: the more exemptions you can take, the less there is left for them to garnish. Good luck!

[treehugger1]

A couple of things here.

1) Chexsystems: I fyou apply for a checking account with many banks they sheck check systems. There check on you is reported in list of financial institutions asking about you. I just received my chexsystem report and several banks that i applied for checking accounts within the last two years show up as querying checxsystem. Anyone looking at my chexsystem report will see the names of these finanical companies.

2) You are lucky that you received the writ of garnishment along with the exemption form prior to the Ca (or whoever) hitting your bank account. the Oregon revised Statutes DO NOT require that a debtor receive a copy of the writ and exemption notice prior to the levy or garnishment occurring. I think the law allows up to 15 days to notify the debtor. In many cases, CA's and other creditors guess what yoru payroll dates are and have the writ served in such a manner that you don't know about it until it happens. You are fortunate and should get your claim of exemptions filed immediately.

When I was speaking with legal counsel a year ago, one of the things they mentioned is that I should make sure that if I'm using direct deposit of paycheck into a bank account, the deposit clearly shows up as from a payroll system. In Oregon (I imagine other states,) up to $7500 of wages is still exempt when deposited in an account. But, you do have to provide evidence that the funds are all from wages. I was cautoned to make sure that the only deposits going into the account were verifiable payroll deposits.

I applaud you for acting swiftly in this matter. Most folks do not have a clue that the exemption form in Oregon can work in their favor. I suspect that many do not even bother to deal with it. I know a few colleagues who had there bank accounts hit for several $k by CA's and when I asked them about filing their exemptions, they ask, "what are those?"

[twinsplus14me]

Several new questions...PLEASE HELP!...

We're expecting a refund of approx. 5k due to EIC and childcare tax credit.

We were going to use part of the refund to file 7. Do I need to wait a while or should we file right away?

Our bank acct has been garnished. The teller told my husband it was a one shot deal. Doesn't that type of garnishment just stay on your acct and they keep taking the money till it's paid off? They got all of 3 dollars that day.

Where do I go to cash the check when it comes in?

We really need the money now as my husband has been on unemployment for the last 4 months. I don't want to deposit the check and have the CA take a big chunk of it.

[MajorMike]

How can it be a serious health issue but you can't get disability? That's awful! My sister has a bad back and she is on permanent disability. Did you get an attorney and fight???

[MajorMike]

I don't even know of a place that will cash it if you dont have an account. can you open a new bank account at a different bank or credit union? Also, I'd ask around but if you just got a huge refund just before filing, the trustee could take it I think...

We're expecting a refund of approx. 5k due to EIC and childcare tax credit.

We were going to use part of the refund to file 7. Do I need to wait a while or should we file right away?

Our bank acct has been garnished. The teller told my husband it was a one shot deal. Doesn't that type of garnishment just stay on your acct and they keep taking the money till it's paid off? They got all of 3 dollars that day.

Where do I go to cash the check when it comes in?

We really need the money now as my husband has been on unemployment for the last 4 months. I don't want to deposit the check and have the CA take a big chunk of it.

[lrprn]

I'd ask around but if you just got a huge refund just before filing, the trustee could take it I think...

MM, 99% of the time this answer of yours is wrong. If the tax refund comes before the OP files, that refund is not a part of their bankruptcy estate so the trustee has no control over the refund itself.

However, twins does need to be able to protect the refund with their state's bk exemptions. The best way to deal with a refund that comes close to filing is to spend the refund down for legitimate living expenses to the point their state's exemptions do protect the cash while keeping all the receipts. This is very commonly done and perfectly legal - it's smart pre-planning.

In the future, MM - if you really aren't sure about an answer, it's best to not answer at all. Our members (especially the newer ones) take everything they read here very seriously. We don't want to freak anyone out with misleading or incorrect information.

[treehugger1]

However, here is the possible strange catch with the Oregon trustees: I was told by three different attorneys that all money coming into the household during the last six months prior to filing is considered "income." Now, I don't know if this includes a "tax return" or not. Contact an attorney if you are worried about this. I would do a bit of "homework" here.

Where to cash the check? Call a few Native American gambling casinos in your area and see if they will cash the check for you with proper ID. Some will. Oregon also recently cracked down on the check-cashing/payday loan statutes. The percentage an establishment is entitled to charge was significantly reduced. While I don't personally recommend such an approach, you might look into this.

Cheers.

[WhatMoney]

Originally Posted by twinsplus14me
Our bank acct has been garnished. The teller told my husband it was a one shot deal. Doesn't that type of garnishment just stay on your acct and they keep taking the money till it's paid off?

[WhatMoney]

$100 max for a $5K check at the payday loansharks... But they may still have a dollar limit on the check. I really don't think these payday outfits would cash my $100,000 Nigerian bank check for $100.

"The Oregon Check Cashing Act, passed by the Oregon legislature in 2007, takes effect today. The new law limits the maximum fees charged for cashing government and payroll checks.

The Act limits check-cashing fees to the greater of 2 percent or $5 for checks issued by the U.S. Government, State of Oregon, or the municipality where the check is cashed; the greater of 3 percent or $5 for payroll checks and all other government checks; and the greater of $5 or 10 percent for personal checks. The total fee for cashing any check cannot exceed $100."

[treehugger1]

It is my understanding after consulting with legal counsel, that the 90 day rule on garnishments begins when the garnishment is first paid upon. This is in line with Oregon's law of "first in time, first in line." If a writ is issued for garnishment, the 90 days applies to when the first payment is made against the writ, not when the writ was issued. As an example, suppose you are paying on one writ and another comes in. It could be that the new writ was filed on October 1st, however, the 90 days does not start until a first payment is made against the garnishment. If the previous writ being paid on lasts until approximately December 29, the timing for the new writ will begin at this time. Just my two cents. Do your own due diligence. One of the cool things about Oregon law is that the 25% rule applies to all garnishments. As an example, suppose you have a student loan garnishment of 15%(never expires, even under the state 90 day rule) and a new writ comes in. The new writ can only garnish the remaining 10%. You can imagine how long and how troublesome it would be for a large debt to be collected on in this fashion. Their 90 days would expire and they would have to file a new writ. In the meantime, it is feasible that other writs of garnishment could be in the cue.

When I realized the student loan debacle in Oregon bankruptcies, it was 'suggested" to me that I let the loan default and "agree" to a voluntary 15% garnishment, since the student loans have to be paid regardless of BK or other debts. H*ll, if you have to pay our student loans, then why not take this opportunity and leave other creditors only 10% to garnish. Again, do your own due diligence. I am not an attorney, but there are many ways to stymy garnishment in Oregon.

You do need to be careful. If you challenge a writ of garnishment here, the garnishment does not cease, but under the revised statutes, it appears that the garnishment is sent to the court until resolution is reached. Appealing a garnishment does not necessarily stop garnishment.

If there is no way you can afford garnishment, then perhaps it is time for you to seriously file for BK.

[WhatMoney]

treehugger,

Not clear if you are responding to my post - but I believe you are thinking about wage garnishments, which do continue for 90 days and do have the "first in time, first in line" rule. ORS 18.625 applies to garnishments other than wage garnishment - such as the seizure of deposited funds in a checking account that are not exempt and not from wages. This is the situation with the OP's question about depositing a $5K check in a previously levied checking account.

[treehugger1]

WM,

Yes, I was speaking about wage garnishment. However, if a garnishment/levy for a bank account does not satisfy the debt, it is a simple matter to execute a new levy. Thanks for keeping me on track.

There are so many options for "accounts" out there these days, it is worth anyone's time to explore such alternatives. When one looks at the options of debit card accounts (Western union, NetSpend, and dozens of others,) there is a virtual world out there that is not easily traced except through a debtor exam. And, even then if the wording is not explicit under examination, one does not have to give up even these accounts. Most of these accounts specifically state, "This is not a bank account." A less sophisticated consumer/citizen would not be expected to list such accounts as bank accounts under examination. I'm just speculating here... LOL It seems to me that laws/statutes are far behind the quickly changing world of information and personal finance.

[twinsplus14me]

Sounds like it's worth it...

It would be worth it to pay a check cashing fee not to have to worry about dealing with the bank. But, the two places I called this morning won't cash a check that large. I know that CNN had something not long ago about Wal Mart cashing checks, maybe that's a possibility?

I just can't see depositing the check and giving the credit agency over 1/4 of it when we're going to file soon. They already took most of the profit from the sale of our house, but this bill came in after the fact. Now, I guess they think we actually have something to come after.

As far as I know, the bank didn't charge us a " legal fee ", so far they only charged $20 for dealing with the garnishment.

I plan on stocking up on groceries and household goods like t.p., laundry detergent and stuff, paying the power bill in advance, car payment, etc.

I've been told that it could take up to 3 years to get on permanent disability due to the backlog here, but I will do everything I can.

I looked up the OR exemptions this morning and it specifically lists Earned Income Tax credits, and $7500 deposited income, so I guess we will be okay regardless of what we do with the money???

In the meantime, we are 2 mos. behind with Citigroup on the car, and they are calling daily. They said to pay a pmt by the end of the month or let them know where the car is. ( I don't understand why they would ask when they have our current address.) Has anyone reaffirmed the debt with Citigroup when filing? We do love our car, but are not sure we will be able to keep it. Should I just give it back and get something used? We owe over bluebook on it. I figure we'll probably have to surrender it, and buy something used. When should we stop paying on it? How long does the process take?

Thank you all for your input. I appreciate each and every one of your responses. There is such a wealth of info on this board.

[WhatMoney]

It would be worth it to pay a check cashing fee not to have to worry about dealing with the bank. But, the two places I called this morning won't cash a check that large. I know that CNN had something not long ago about Wal Mart cashing checks, maybe that's a possibility?

You'll need to call your nearest WalMart store to get their maximum check cashing limit. It's usually $1000 for payroll checks - may be higher for tax refund checks. I think you will have a problem cashing a $5K check anywhere except a bank.

To reiterate the bank levy rules, for non-wage deposits a bank levy is a one-time event in Oregon. Here are some more quotes from legal sites:

Bank Levy

Of course confirm this with your bank manager before depositing your check, or just open a new account at another bank. It would take a collection attorney with a judgement at least one week to find and levy your new account. That's how long the new writ of garnishment court procedure alone would take, then there is the service, after they found your new account location.

BTW, I'd like to know what OR bank only charges a $20 legal process fee. The cheapest fee in my area is $75, with most in the $100-$150 range. You can PM me if you wish.

[twinsplus14me]

Now I'm thinking the best thing to do is just to cash it at the bank we use, just not depositing anything into the acct. Wouldn't that work?

Oh, and get this. The funds they did take already were from my husband's VA disability payment. It goes in monthly and is the only thing we are keeping in the account now. As far as I can tell, that is excluded and they can't take it just like his unemployment is. We're going to file a challenge to garnishment this week so they can't take any more.

I can't believe they even processed it when it clearly says on the p/w that veteran's benefits are excluded.