by John G. Merna, Esq.
Introduction: What is Garnishment?
A garnishment is a legal process that allows creditors to collect money from the debtor’s wages, bank account, or other assets. The creditor must first obtain a court order before they can garnish the debtor’s assets. The court order will specify how much of the debtor’s wages can be garnished and for how long.
What are the Types of Garnishments?
There are other ways to attach both tangible and intangible property in Virginia, such as levying on personal property such as a car or furniture. These types of levy are less common than bank and wage garnishments and often only used in extreme cases where the judgment creditor feels a wage garnishment or bank garnishment is not possible.
How Much can be Garnished from Wages?
Wages: In Virginia, the garnishment amount is limited to 25% of the person’s disposable income. Disposable income is defined as gross income minus deductions for federal, state and local taxes, Social Security and Medicare contributions, union dues and health insurance premiums.
Bank Account: In Virginia, 100% of unprotected funds can be taken and the account frozen to intercept any future funds being deposited during the garnishment period. Some funds that are protected included social security benefits, veterans’ benefits, TANF, unemployment compensation, workers compensation.
Tip: If you account has been garnished discontinue using it and transfer all direct deposits to another bank or financial institute.
Tip: If you commingle protected and unprotected sources of income the bank may freeze your account and leave it to the court to determine what funds are protected. If you are behind on your bills have separate accounts for your protected funds like social security and retirement, and a separate account for any wage income.
What are the Requirements for a Garnishment?
The requirements for garnishment in Virginia are as follows:
- The creditor must have a judgment against the debtor.
- The creditor must have obtained an order of garnishment from the court.
- The debtor must be employed or have some other regular source of income or savings.
- The creditor must serve notice on the employer or other source of income or savings and provide them with copies of the order and judgment.
When Would A Garnishment Start?
In order to garnish either a bank account or wages a judgment creditor must submit a “Garnishment Summons” to the court requesting a garnishment order to be issued to either the bank or the employer of the judgment debtor. Judgment debtors are not require to receive notice of the garnishment prior to implementation.
Estimated Start of Garnishment:
Banks: The accounts will generally be frozen immediately once the garnishment order is received by the bank. The garnishment will be effective against all account in the debtors name regardless of the state where the account was established. This applies to all joint accounts including joint account held with children.
TIP: Bank levies increase in the first quarter of the year as judgment creditors hope to capture any tax refunds a debtor may be receiving. If you have a judgment against you consider opening a new bank account prior to filing your taxes to reduce the risk of a bank levy of your tax refund.
Wages: If the Garnishment Summons was sent to the registered agent for the corporation and the corporation uses a large register agent “mill”, it may take several weeks for the garnishment to be implemented. If the garnishment is sent directly to the payroll department for the employer the employer is instructed to withhold 25% of eligible wages and forward the funds to the court. Generally, a person has to make more than $300 per week to be eligible to be garnished.
How Will They Know Where To Garnish Me?
With the emergence of the internet has arisen a information collection culture that tracks all forms of data about people which is not just limited to buying preferences. Some of this information is you agree to provide when applying for credit. Other information you provide the world voluntarily on your social media accounts, which can be “scraped” by AI programs to provide information on your work location, banking, where you live, etc.
“Skip tracing” is the term used to describe the act of trying to locate people and/or their assets in order to collect a debt. Many services have popped up in the last 10 years that provide very effective and real-time information on employment, banking, and assets.
The other way creditors can find out where you work or bank is that you tell them, knowing or unknowing. For instance, the last rent check you wrote before you broke the lease tells them where you bank. That rental application generally requires you to list your employment as does a credit card application. Just be aware that if you have been sued it is not difficult to find your employer or your bank.
How do I Stop or Prevent a Garnishment?
How to prevent a garnishment is simple. You have to reach some arrangement with the creditor to pay the amount owed. This is not alway easy as the responsibility for collecting the debt is often transferred between collection agencies and law firms during the collections cycle. However, once you are sued the attorney of record is the best contact to reach some agreement to pay on the debt.
There are two ways to stop garnishment in Virginia. One way is by filing for bankruptcy, which will stop all garnishments and other collection efforts. The other way is by filing for an exemption, which will exempt you from garnishment but not bankruptcy. Under Virginia law, if you make less than approximately $300 per week you cannot be garnished. There are other exemption that will protect certain source of income from garnishment.
Please visit our article on “The Complete Guide to Virginia Garnishment Exemption Law”
Conclusion: The Complete Guide to Virginia Garnishments
The simple fact is that only a bankruptcy can put a permanent halt to a legitimate garnishment of wages or bank accounts. While exemptions may protect some sources they do not eliminate the underlying debt. As such, the creditor can just continue to search for other assets to garnish.
If you are faced with a garnishment and act quickly by calling a bankruptcy attorney it is possible to get the garnished money back.