Read Our Reviews

Call Now! 855-780-4357

Can I get Money Garnished From me Back When I File for Bankruptcy?

For people living on a tight budget, a garnishment can be the difference between making ends meet and falling further into debt. If you are being garnished and you are considering bankruptcy, you should know that you may be able to recover money taken from you by your creditors, but the garnishment must meet certain requirements for you to get your money back.

First, the timing of the garnishment determines whether you can recover any of the money taken from you. If money was garnished from you before you file for bankruptcy, that money can only be recovered if it was taken within the immediate 90 day period before filing your case. For example, if you filed your bankruptcy case on November 1, 2014, you could recover money garnished up to 90 days before that date (August 3 to November 1). However, you could not recover any money taken earlier than that 90-day period (in our example, before August 3). Additionally, if your creditors continue to garnish any of your money after you file for bankruptcy, that money can be also recovered for you.

Second, the amount of the garnishment within the past 90 days can determine whether you can recover money taken from you by your creditors. The amount of money taken from you within the past 90 days must be $600 or more for you to be able to recover that money. If the amount taken from you is less than $600 total in the past 90 days, you will unfortunately not be able to recover that money in bankruptcy. (But, note that if your creditors continue to garnish money from you after you file for bankruptcy, any amount that they take after you file can be recovered for you).

Third, it is only worth recovering money garnished from you if you are able to protect that amount of money as an asset in your case. Whether you can protect the money you recover depends upon the value of other property that you own and that you want to protect in bankruptcy. It can be a complex question, but your bankruptcy attorney will be able to walk you through what property can be protected when you file for bankruptcy.

Finally, garnishments are only worth recovering if the garnishment is from a type of debt that can be discharged in bankruptcy. Certain debts cannot be discharged in bankruptcy (you will still owe these debts after your bankruptcy). Debts such as student loans, alimony, child support, and recent tax debt, will remain after bankruptcy. There will not be any point in recovering a garnishment for one of these types of debt, as you will still owe that debt after bankruptcy.

Written by Hoglund Law

The attorneys of Hoglund law are licensed in Minnesota, Wisconsin and Ohio. Hoglund, Chwialkowski & Mrozik, PLLC is based in Roseville, Minnesota. In addition to handling cases involving bankruptcy & social security, Hoglund, Chwialkowski & Mrozik, PLLC handles faulty drugs and toxic exposure.

View all author posts →

What to Do: Bankruptcy or Debt Consolidation?

When facing issues with debts, there are a couple of ways to go about fixing it, two of which being more popular: bankruptcy and debt consolidation. Much like other decisions made in life, each one has its own benefits and consequences. However, filing bankruptcy is usually the better route to take when deciding between the two.

Unlike bankruptcy, debt consolidation does not completely discharge your debts. Instead, your credit counselor will need to try and negotiate with creditors to create affordable interest rates for you, lowered monthly payments, or help you obtain a larger loan to pay off credit debts. This is problematic because it does not wipe out your debts, but practically creates more being as you may need to take out a loan. Another pitfall of debt consolidation is the fact that not all creditors will want to make a deal with a credit counselor; nor do they have to be dealt with all at once. If your credit counselor so chooses, they can deal with your creditors one at a time which will both prolong the process and make you susceptible to problems with your other creditors who have yet to be dealt with. One more thing to keep in mind about debt consolidation is that credit counselors usually only help out with unsecured debts (credit cards, medical bills, etc.), not secured debts (mortgages, vehicle loans, etc.). Bankruptcy, however, does deal with both.

As you may have guessed after reading the previous paragraph, filing bankruptcy is most likely the best option to go with. If you were to file under Chapter 7, a large portion of unsecured debts will be discharged and unlike debt consolidation, all creditors must oblige by it. They cannot choose whether to be a part of the discharged debts or not. If you were to go the route of Chapter 13, you will set up an affordable payment plan with creditors to pay off debts with the additional benefit of protecting your secured assets from being repossessed (unlike in debt consolidation). One final thing to keep in mind is that debt consolidation has a tendency to cost more than bankruptcy, as well as have fewer benefits. Although every person’s situation is different and their solutions to debt may vary, filing bankruptcy should be considered before going through with debt consolidation.

Written by Hoglund Law

The attorneys of Hoglund law are licensed in Minnesota, Wisconsin and Ohio. Hoglund, Chwialkowski & Mrozik, PLLC is based in Roseville, Minnesota. In addition to handling cases involving bankruptcy & social security, Hoglund, Chwialkowski & Mrozik, PLLC handles faulty drugs and toxic exposure.

View all author posts →

Is student loan dischargeable in a Chapter 13?

Student loans are typically non-dischargeable in either a Chapter 13 Bankruptcy or in a Chapter 7 Bankruptcy. (In some instances, an individual can have his/her student loans discharged in a bankruptcy if the individual can show the student loans present an undue hardship. The standard for this is very high and very few individuals are able to successfully show this.)

A Chapter 13 is essentially a repayment plan where the individuals pay back their creditors based upon their income. Some people will pay the creditors 1% of what is owed to them and some will pay back 100%. The amount paid back will depend on a person’s individual circumstances. If a person owes student loans in a Chapter 13, the student loans will survive the bankruptcy and essentially be waiting for the debtor at the completion of the Chapter 13.

While the individual is in a bankruptcy, the student loan company will be treated like any other unsecured creditor if it is put into the plan. The student will only get a portion of the Chapter 13 payment if they get anything at all. The debtor will still owe the student loan company whatever has not been paid upon the completion of the bankruptcy.

If a student loan is considered long-term debt, meaning that the individual will be paying on the student loan for longer than the duration of the Chapter 13 plan even if the individual were making full payment to the student loan company, then it is permissible to allow the debtor to continue to pay the student loan company directly while the person is in the Chapter 13. In many cases, this will be a benefit to the debtor because the student loan company will be paid more during the Chapter 13 plan and the debtor will therefore owe them less when the Chapter 13 plan is completed.

Student loans are typically non-dischargeable in either a Chapter 13 Bankruptcy or in a Chapter 7 Bankruptcy. (In some instances, an individual can have his/her student loans discharged in a bankruptcy if the individual can show the student loans present an undue hardship. The standard for this is very high and very few individuals are able to successfully show this.)

A Chapter 13 is essentially a repayment plan where the individuals pay back their creditors based upon their income. Some people will pay the creditors 1% of what is owed to them and some will pay back 100%. The amount paid back will depend on a person’s individual circumstances. If a person owes student loans in a Chapter 13, the student loans will survive the bankruptcy and essentially be waiting for the debtor at the completion of the Chapter 13.

While the individual is in a bankruptcy, the student loan company will be treated like any other unsecured creditor if it is put into the plan. The student will only get a portion of the Chapter 13 payment if they get anything at all. The debtor will still owe the student loan company whatever has not been paid upon the completion of the bankruptcy.

If a student loan is considered long-term debt, meaning that the individual will be paying on the student loan for longer than the duration of the Chapter 13 plan even if the individual were making full payment to the student loan company, then it is permissible to allow the debtor to continue to pay the student loan company directly while the person is in the Chapter 13. In many cases, this will be a benefit to the debtor because the student loan company will be paid more during the Chapter 13 plan and the debtor will therefore owe them less when the Chapter 13 plan is completed.

Written by Hoglund Law

The attorneys of Hoglund law are licensed in Minnesota, Wisconsin and Ohio. Hoglund, Chwialkowski & Mrozik, PLLC is based in Roseville, Minnesota. In addition to handling cases involving bankruptcy & social security, Hoglund, Chwialkowski & Mrozik, PLLC handles faulty drugs and toxic exposure.

View all author posts →