Your One Stop Resource for Saving Money.
Information on Two Creditors Garnishing Wages at the Same Time - The Bills.com Blog
Bills.com Blog > Debthelp Questions > Two Creditors Garnishing Wages at the Same Time
Information on Two Creditors Garnishing Wages at the Same Time
Question: Can my paycheck be garnished by two different collection companies at the same time? If so can they both take the normal 25%? Thank you
Answer: The amount that your wages can be garnished for the collection of a judgment on an unsecured debt primarily depends on your state’s laws relating to wage garnishment. In most states, a judgment debtor’s wages can be garnished up to a maximum of25% of his or her net income; in fact, 25% is the maximum garnishment allowed under federal law, so no state allows garnishment of more than 25% of a debtor’s net income. However, some states further limit the amount that can be garnished from their residents. For example, Texas, North Carolina, South Carolina, and Pennsylvania do not generally allow wage garnishment for unsecured debts, while Florida does not allow garnishment if a debtor is considered the head of a household. Also, many state courts will reduce the amount of a garnishment if the debtor can demonstrate that the current garnishment amount is causing an undue hardship for the debtor and his family. Before you assume that your wages will be garnished, I encourage you to review your state’s laws relating to garnishment for the payment of judgments for unsecured debts. To read more about your state’s laws relating to wage garnishment and what other assets are protected by state law, you should visit bcsalliance.com .
Thankfully, the garnishment limits outlined by federal and state laws define the maximum total amount that can be garnished from a debtor’s paycheck at any one time. For example, under federal law, the maximum that a consumer can be garnished for the collection of an unsecured debt judgment is
25% of his after-tax earnings. Generally speaking, if a consumer has more than one judgment creditor attempting to garnish his wages, the creditor who files for garnishment first is paid first; any garnishments received while a garnishment is already in place will sit unpaid until the first garnishment is paid. You should keep in mind that certain types of garnishments, such as those for delinquent taxes or child support, take priority over garnishments for regular judgments, so even if you are already being garnished by a creditor, if the IRS sends a garnishment notice to your employer, the first garnishment would stop the IRS would be paid before the garnishment for the judgment resumed. Also, you should know that the amount that can be garnished to pay these “priority debts” is generally higher than the amount that can be garnished for regular judgments. For example, a garnishment for delinquent child support may be able to take as much as 50% of your earnings, or possibly even more, depending on your state’s laws and the court order requiring the child support payments.
So, in a simple answer to your question, creditors cannot each garnish 25% of your wages; the creditors will either be forced to split the garnishment amount, or they will be required to wait in line to be paid in the order the garnishments were received by your employer. However,
you must consider that having multiple garnishments sent to your employer may be grounds for termination of your employment. Under federal law, you cannot be fired for receiving one garnishment, but subsequent garnishments could be cause for your employer to terminate your employment, depending on your state’s laws and your employer’s policies relating to garnishments. If at all possible, I strongly encourage you to resolve these debts before a wage garnishment begins to prevent any potential problems with your employer.
If you are struggling to repay unsecured debts, I encourage you to visit the Bills.com Debt Help page to read about various options available to help consumers resolve their outstanding debts. Filing for bankruptcy protection may be one option available to you to stop these wage garnishments; I invite you to visit the Bills.com Bankruptcy page to learn more about bankruptcy. I also encourage you to consult with a qualified attorney in your area to determine if bankruptcy is a viable solution to your financial problems.
I wish you the best of luck in resolving these debts, and hope that the information I have provided helps you Find. Learn. Save.
Best,
Bill
www.bills.com/blogs
Also, make sure to get a free financial health check-up with Bills IQ!
User Comments
Submit questions/comments about this post:
Bill has answered all sorts of questions and has been able to provide those in need of financial guidance with helpful and valuable advice and information on their specific financial area of interest. If you need specific guidance on any of the above mentioned financial areas, feel free to Ask Bill your financial questions and get better informed. Also, make sure to get a free financial health check-up with Bills IQ!
© 2006 - 2008Bills.com LLC. All Rights Reserved.
1. Posted by mary pahl on Thursday 15th May 2008 07:03
I live in Wisconsin and have a garnishment of wagesfor a debt owed to Wisconsin Dept of Revenue (prior to my marriage and we have a premarital agreement so that it is solely my debt) My question is this: Since I have a garnishment, can a third party debt collector issue a garnishment for a debt my husband owes?
2. Posted by Bill on Thursday 15th May 2008 08:45
Because you live in a community property state, the creditor could possibly sue both you and your husband, under the theory that this debt was incurred as a community debt. Also, if you were a co-signor on your husband's account, you may be legally liable for the debt. As far as the garnishments go, the creditor in question will first have to obtain a judgment for garnishment in order to start garnishing your wages. There are limits on the amount of wages that can be garnished. Typically, 20% of a debtor's net earnings after withholding taxes and Social Security can be taken by a creditor. A debtor does have the right to assert various exemptions to the garnishment, including income below the Federal Poverty Guidelines, eligibility to receive foods stamps or medical assistance, or court-ordered assignments of child support that exceed 25% of the debtor's wages. Therefore, if your previous garnishment has already reached 20% then the other creditor would have to wait till the earlier garnishment is satisfied before they can enforce their judgment on you.
3. Posted by lisa wood on Friday 29th August 2008 12:52
my bank accounts, even my daughter's and my mother's, all linked to me at same bank, were garnished while i was in litigation following divorce, for a property settlement agreement. they wiped up clean, no percent recognized, zero balance, mine had just been funded with child support checks x 5 for back pay, and my mom's social security. that was last year, i've tried to seek help. the collector is attorney, now send letter to me for again over $14,000.00 in garnishment!. where should i seek help, or am i just out of luck/? thank you.
4. Posted by Bill on Friday 29th August 2008 15:04
The first thing I suggest you do is open a seperate bank account for you Mom to cash her social security checks. Social security income and child support payments are usually protected from garnishments and I am not sure how the company managed to take out everything in your account. You definitely need to contact an attorney to see what your options are. Bankruptcy may protect you from this, but I just don't know enough about your situation, nor am I an attorney, so plese do contact one immediately.
5. Posted by Marie on Tuesday 30th September 2008 13:10
I live in NJ and just received word of a garnishment and know of one more on the way, can I be fired? How do I find out?
6. Posted by Bill on Tuesday 30th September 2008 14:39
Whether you get fired because of this granishment depends on your company's internal policy. You should find this out through the HR person in your office.