Wage Garnishment & Payday Loan in California

Are payday lenders permitted to contact your employer and seek out a garnishment of your wages without a court order?

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Bill's Answer: Answered by Mark Cappel

The waiver/statement/document you signed that allows the creditor to garnish your wages without a court order is rubbish. An experienced and properly trained human resources or payroll administrator would laugh if such a document crossed their desk.

However, not all human resources or payroll people are experienced or trained and may be bamboozled by an illegal wage garnishment order if it is dressed up with intimidating legal language and arrives in an envelope from an attorney’s office. I suggest you locate your human resources or payroll person and have a confidential conversation with about your situation. Ask if they have handled wage garnishments before.

In California, a creditor is required to file an Application for Earnings Withholding Order (form WG-001) and Writ of Execution (form EJ-130). A completed Writ of Execution will contain a stamp from the California court and a signature by a clerk of the court. An experienced human resources or payroll administrator will recognize an authentic Writ of Execution and will not be fooled by whatever document the payday lender will provide. (See the California Franchise Tax Board document Wage Garnishment / Earnings Withholding Order and Small Claims Forms: Collections (for Debtors))

Editor’s note: Comments on this page are closed. See Payday Loans to learn how to handle payday loan collections. See the Bills.com payday loan resources for California, Florida, Illinois, Massachusetts, Missouri, New York, Texas, and Virginia to learn more about payday loan laws in those states.

Other states will handle wage garnishments differently, but the basics are the same: A court must order a garnishment unless the garnishment is related to tax liability or the repayment of a student loan.

Assuming for the sake of argument that a judgment-creditor begins the wage garnishment process, judgment-debtors can apply for an exemption. In California, judgment-debtors who are about to have their wages garnished should read California form WG-003 and then complete form WG-006 to apply for an exemption. Do so immediately -- a wage garnishment is much easier to prevent than unwind if you are exempt from garnishment.

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Comments (14)

Sonia R.
Auberry, CA  |  June 01, 2011
I have a court ordered judgement issued against me. I don't know if they have the court order to garnish my wages. Can they just take money from my bank account? Can they also take money from my children's savings account?
June 01, 2011
A judgment-creditor may use the collection methods allowed by the state where the judgment-debtor resides. Generally, these are wage garnishment, account levy, and lien. Regarding your question about your children's savings accounts, the answer depends on which Social Security number is tied to the account. If you opened the accounts using your child's Social Security number, then the judgment-debtor may not touch those accounts. If, on the other hand, the accounts are tied to your Social Security number, then they are at risk of levy.
Yong K.
Sacramento, CA  |  January 28, 2011
Hello Bill, I am the plaintiff on an unlawful judgment. I have the writ of Execution and it was processed through the Sheriff's Office for wage garnishment. I'm unable to collect at the moment because there is a higher priority garnishment but should be able to try again in about 6 months. I would like to know if I can legally try to collect on my own without going through the Sheriff's office for the second try. It takes them 3 months to just send out an order and the whole process is so slow with them. Could you tell me what documents I will need to send the employer for wage garnishment? Thank you, Kim
January 31, 2011
You are asking about what the law profession calls remedies.
  1. In California, it is traditional for the county sheriff's office to execute orders of judgment. You mentioned your sheriff's office does not process these orders with alacrity. Talk to the sheriff's deputy to see if there is anything you can do to make the process move faster. Perhaps you are not completing the forms completely or correctly, which causes your case to slip to the bottom of the pile. Remember that sheriff departments are staffed by people, and they will tend to respond positively to pleasant conversation and questions that do not challenge their authority.
  2. Broach the subject whether there is another office in your country that executes judgments. my guess is no, but California law does not require the sheriff's office execute judgments.
  3. See the California Courts Self-Help Center Am I able to collect (called "garnish") from the debtor's wages if he or she is employed? to learn more about California wage garnishment.

The laws of remedies are very precise. Follow the civil procedure laws exactly when completing a garnishment order, lien, and so on. Consult with a lawyer if a form does not make sense to you, or if the procedures are unclear. Making a procedural error at this stage in the game can cause all of your hard work to this point to be thrown out the window.

July 14, 2010
Yes, and this is called judgment domestication. Click on the link I just mentioned to see the legal processes that must take place. The link I mentioned discusses two other states, but the overall process is the same between all of the states (more or less).
AJ .
July 14, 2010
i currently live in dallas but have plans on moving to new jersey. can a collection agency garnish wages for past old debt (payday loans and credit cards) made in texas?
April 01, 2010
If the collection agent cannot validate the debt and is contacting you by telephone, send the collection agent a cease-and-desist letter. See the Bills.com resource Debt Validation to learn more about validating a debt.
Valerie .
April 01, 2010
I took out a $300 payday loan. After paying over $750 in payments, I withdrew my ACH authorization and the creditor supposedly sent it to a collection agency. I called that agency they have no record, but now over 6 months later I am being harassed by a totally different CA. I called the creditor they did not know this company and did not send my account to them. What would you suggest, I have requested a validation twice, but have received nothing.
March 31, 2010
Impossible for me to answer your question without reviewing the contract you signed when your received the payday loan.
Sophea .
March 31, 2010
I took out an internet payday loan for $750. I had to close my account due to so many overdrafts. I called the bank today and got a copy of all my statements and after calculating the amount that I paid in intrest, it came out to be $787.00. Now my question is, can they still garnish my wage even tho I paid this much amount in just intrest? The principle amount is $750 and I paid $787. Can they still garnish my wage?
February 04, 2010
In California, yes, there is a way to dispute a garnishment order. See What is a Claim of Exemption for wage garnishment? and How do I file a Claim of Exemption for a wage garnishment? Yes, in California the debtor must be notified with an Original Writ of Execution form EJ-130.
Resa .
February 04, 2010
Is there a way to fight/appeal a garnishment order issued by the Court? Also, does the collection agency, payday loan company or whatever have a requirement to serve you prior to filing for a garnishment order?
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