Expert: Michael Brotherton - 9/24/2007

Question
Hi,

My husband and I have been working with a debt settlement company for the last two years.  We almost have all of our credit card debt paid off through this company with the exception of two cards.  We recently received a letter from suttell and assoc. saying we needed to appear in court or they were going to garnish my husbands wages.  After consulting with the debt settlement co. we appeared in court with our paperwork.  We gave the lawyer our paperwork and they said they would take a look at our finances to see what kind of payment we could afford.  We didn't hear anything from suttell and assoc. for about 3 weeks until my husbands boss received garnishment papers. I am unemployed and we are living with family because we cannot afford housing right now.  I know they did not take our finances into consideration because they are garnishing a large amount out of my husbands check.  I was reading some information online and it said that they cannot garnish more than 25% of your disposable income, if this is correct than I believe they are garnishing more than 25%.  Please let me know what our rights are or what our next step should be.
Thanks for your time,
April

Answer
This depends on what state you live in. In some states you may be able to set up a trusteeship with the courts so that the garnishment amount goes toward all of your unsecured debt rather than just one creditor. This could save you some money but it depends on your overall budget.

You may also want to look at a chapter 13 or a chapter 7 bankruptcy. Although nobody wants to file bk you need to protect your paycheck.

Let me know what state you live in and I will check into your states garnishment and collection laws.

Also, it i possible his employer may have miscalculated the garnishment. Ask the courts to help you go over your paycheck and calculate the correct amount.