A debt collector called me and said “We will garnish your next paycheck.” Can they do this?

 I am continuously amazed at the depths some debt collectors will go to in order to scare unwary debtors into making payments they cannot afford at the time.  The statement “We will garnish your next paycheck” is probably a lie. 

 In Alabama in order for a creditor to obtain a writ of garnishment against your employer to withhold money from your paycheck, that creditor must have a judgment against you.  In order to have a judgment against you, that creditor must have filed a lawsuit against you and won either after a trial or by default, that is, because you did not file a response.

Normally when this threat is being made, a lawsuit has yet to be filed.  How do you know if you have been sued?  First, if suit has been filed against you, you should have been served with a Summons and Complaint by either the sheriff’s department of your county or by certified mail.  However, if you cannot be found by the creditor, the creditor may have you served by publication, that is, by running a notice in the newspaper in the county of your last known address.  If you are still unsure, you may call the clerk of court of your county.

What if I have been sued?  See a lawyer immediately.  Depending on which court, Small Claims/District or Circuit, you have either 14 or 30 days respectively from the day you were served to file an answer.  Filing an answer generally denying the allegations in the lawsuit will prevent the creditor from obtaining a default judgment against you and will lead to your case being set for court after a few months.  This will give you time to save money and/or get your bankruptcy filed.

What if I already have a judgment and/or garnishment against me?  If you already have a judgment and/or garnishment against you, I would again suggest you see an attorney immediately.  You may be able to have the judgment set aside or appealed, but only if you act very quickly.  This may also be a good time to take a strong and hard look at bankruptcy.  With a bankruptcy you should be able to discharge the judgment prior to garnishment and stop any garnishment that is already in place.  Upon filing a bankruptcy, you may even be able to have a portion of any money garnished from your check returned to you.

The bottom line is do not let harassing calls from creditors or debt collectors scare you into giving them money you cannot afford to give them.  Many will say anything they think will frighten you.  If a debt collector says anything that worries you, make an appointment with an attorney and see what your rights are.  It’s probably a good time to take a look at your financial situation anyway.

Please email me with any questions regarding the topic of garnisments or any other bankruptcy or debt related topic.