Creditors have a wide variety of tools to help them collect their debts. One of the most difficult things to deal with is having your wages garnished. Losing a percentage of each paycheck to pay down an obligation is challenging for most people, and unfortunately, this can happen even in a state where garnishment is rarely allowed.
If you are facing significant financial struggles, the protections of the bankruptcy code might be your best option. There are ways to shield your paycheck through this process, and our dedicated bankruptcy attorneys could answer your questions about bankruptcy and wage garnishment in Dallas.
When Can Wages Be Garnished?
Wage garnishment is a process used by creditors to satisfy unpaid debts. It involves filing a legal action that requires your employer or bank to set aside some or all of your property. As part of the creditors’ collection efforts, they can attempt to seize this property and apply it to the debt. Usually, this is only possible after they file a lawsuit and successfully secure a judgment against you.
When your wages are garnished, the portion of your paycheck your employer sets aside is used to pay down your debt. However, Texas has strict rules regarding garnishment. As a baseline, creditors are typically barred from garnishing wages. There are exceptions for certain obligations, including:
- Alimony
- Tax debts
- Child support
Most of the time, consumer debts cannot be recovered in this way.
Understanding how Texas bankruptcy law handles wage garnishment in Dallas is essential if you are worried about protecting your income from creditors.
Wage Garnishment and the Automatic Stay
As an employee, your wages are generally protected from garnishment in most cases. If you happen to fall into one of the few exceptions where your wages can be garnished, filing for bankruptcy in the Dallas bankruptcy court will bring those collection efforts to an immediate halt. This is due to something known as the automatic bankruptcy stay.
There are many facets to the protections provided by the bankruptcy code. While some of the most significant benefits, such as having your debts discharged, only occur at the end of the process, the automatic bankruptcy stay goes into effect the moment you file your petition.
The automatic bankruptcy stay is designed to bring all collection efforts to a halt while your case begins to work its way through the court system. These protections are temporary, but they are also immediate. Once you file, creditors must stop making collection calls, pause any lawsuits currently active against you, and even halt active wage garnishments.
Avoiding the Automatic Stay
It is important to understand that while filing for bankruptcy can pause your wage garnishments, this relief might not last forever. There are situations where your creditor could file a motion to avoid the automatic stay and continue collection efforts. It is even possible to move the court to close your bankruptcy case altogether. Because of these risks, it is important to discuss matters of bankruptcy and wage garnishment with an attorney. With the right support, you may be able to keep these protections in place until your debts are discharged.
Talk to a Dallas Attorney About Bankruptcy and Wage Garnishment
Although there are protections against having your wages garnished under Texas law, there are situations where it is still possible. The good news is that the protections of the bankruptcy code can shield you from these collection efforts and help you move toward a fresh financial start. If you have questions about bankruptcy and wage garnishment in Dallas, our team is here to help. Reach out as soon as possible to schedule a confidential consultation with Allmand Law Firm, PLLC.
