What is Wage Garnishment? How to Stop, FAQs & More

What is Wage Garnishment?

A wage garnishment is the way a creditor can legally deduct money from your paycheck once it sues and wins a money judgment. It is also called an income execution. The judgment creditor causes the income execution to be sent to the judgment debtor’s employer who is then required by law to deduct a certain amount of money from the debtor’s paycheck.

​How much can be deducted depends on the amount of the debtor’s earnings. The deduction typically is 10% of the gross earnings per paycheck. There are some prohibitions on how much can be deducted as well as what types of income are exempt from a wage garnishment such as unemployment benefits, pensions, domestic support and social security. ​

How to Stop Wage Garnishment?

​Once a wage garnishment is in effect, one of the only ways to stop it is by paying off your debt. Bankruptcy is the most common and effective way to immediately stop a wage garnishment.

FAQs

How does wage garnishment work?

The mechanics of a wage garnishment are determined by State laws. Generally, once the creditor obtains a money judgment by suing the debtor and winning, the creditor will submit the judgment to the local Sheriff, who then notifies the judgment debtor of the intent to notify the debtor’s employer to garnish the wages per the judgment. The debtor can avoid the garnishment by paying Sheriff directly.

Can credit card companies garnish wages?

A credit card company can only garnish wages if they have sued the debtor and won a money judgment.

How long before a creditor can garnish wages?

A creditor can garnish wages once it obtains a money judgment through a Court proceeding. Judgments are valid and collectable in New York for 20 years. A judgment is enforceable as a lien against real estate for 10 years unless it is renewed for another 10 years.

Can debt collectors garnish wages?

A debt collector cannot garnish your wages without a Court Order.

Can you negotiate a wage garnishments?

While it is possible to try to negotiate with the creditor, once they have submitted the wage garnishment to the Sheriff, they know that they will start receiving regular payments and it can be difficult to negotiate with the creditor

What happens after a wage garnishment is paid?

When the debt is fully paid, the garnishment should stop and the creditor should file a satisfaction of judgment with the County Clerk’s office. Unfortunately, most creditors fail to take that step.

Can medical bills garnish wages?

If a medical creditor obtains a money judgment, it can garnish your wages the same as any other judgment creditor.

Can unemployment wages be garnished?

In NY, unemployment benefits cannot be garnished by a judgment creditor

How long does it take to garnish wages after judgement?

In NY once a creditor obtains a money judgment, the creditor can seek to garnish wages. The creditor sends the income execution request to the local sheriff who then notifies the judgment debtor of the intent to garnish. If the debtor does not contact the sheriff to make direct payment arrangements within 20 days, the sheriff may then levy against the debtor’s wages

Can landlord garnish your wages for unpaid rent?

A landlord can only garnish wages if they have sued the judgment debtor and obtained a money judgment.

Can the IRS garnish your wages?

Yes. The IRS can levy against wages if you owe a tax debt and fail to pay it. The IRS will send a notice of intent to levy and allow you 30 days to reply.

Does wage garnishment affect credit?

A wage garnishment is not reported on a creditor report so it does not affect your credit. However, the unpaid debt and the judgment obtained are generally reported on a credit report and that does negatively impact credit.

Can payday loans garnish wages?

Payday loans are illegal in New York State.