WHAT’S AN EMPLOYER TO DO WITH A GARNISHMENT ORDER?

Garnishments are statutory remedies granted to a creditor through a judgment to collect on a debt.  When an employer receives a garnishment order, the employer has three options:

(1)  answer the garnishment without an objection;

(2)  answer the garnishment with an objection; or

(3)  do not answer.

Since an employer is required to answer a garnishment within 10 days of receiving it, it is generally best if the employer chooses either options (1) or (2).  Option (1) would require the employer to calculate the percentage of the employee’s wages that will be sent to the court to compensate the creditor, and the employer will inform the court of that amount.  Option (2) allows for the employer to raise an objection to paying any amount to the court, and the reason might be that the employer is already garnishing 25% of the employee’s wages for other creditors or that the debtor is no longer an employee.

If the employer chooses to do nothing, then once the ten days have passed, the employer will be given a Scire facias, which is essentially a second chance that permits the employer to answer before a conditional judgment against the employer becomes final.  This is the important part:  if an employer does not answer the garnishment within the ten days, the court can issue a conditional judgment against the employer for the amount of money due to the creditor.  If the employer does not answer within the time limit defined in the scire facias, then the conditional judgment granted by the court will become final, and the employer becomes responsible for paying the debt.  In addition, at that point, there is no time for objections to be lodged, rather, the employer can only appeal the judgment.

RULE OF THUMB:  If you are an employer, answer the garnishment within ten days.

Image: Salvatore Vuono / FreeDigitalPhotos.net

Credit counseling and Debtor Education

Image: Michelle Meiklejohn / FreeDigitalPhotos.net

In 2005, Congress began requiring debtors seeking bankruptcy relief to complete a credit counseling course in order to file for bankruptcy.  In addition, a debtor must complete a debtor education class on financial management before discharge.  These classes can be completed online, in person, or over the telephone.  I like to give my clients the complete listing of the approved agencies in Middle Tennessee to let them find a the most cost-effective one.  Some courses are priced at $50, while others are only $11.  It is worth the time to shop around online for the best deal.

Positive Review for Gordon Law Group’s Bankruptcy Practice!

This review was recently posted on the google maps website by one of my clients:

 

Smooth sailing ‎‎  By Kristine – Jul 9, 2010 by Kris and Nick Our experience with Gordon Law Group was great. From the first meeting with Robin we knew we would be looked after and be shown honesty and respect with regards to our case. We were represented by Christina who consistently worked with us on getting the appropriate documentation together to avoid problems during our 341 hearing. As with any bankruptcy, there were points of uncertainty but we have to hand it to this group. Christina, Robin, and John were calm and collected the entire time and helped us move smoothly through an otherwise stressful process. The lawyers at Gordon law group know how to get the job done. We are grateful for their hard work. Thanks guys.‎

 

Image: djcodrin / FreeDigitalPhotos.net