How do I stop a wage garnishee?

That is one of the most common questions that I hear in our Kitchener bankruptcy offices.

First off, let's make sure that we are speaking the same language. A garnishee is a court order to take a portion of your pay cheque. It happens when a creditor (someone you owe money to) takes you to court because you have not paid the money that you owe. A judge reviews the case and grants an order for your employer to withhold a portion of your pay cheque until the debt is paid in full. The normal amount is 20% of your gross wages, but the judge can order up to 50% to be taken. If your finances are already feeling strained, a wage garnishment can be the proverbial last straw.

Once a wage garnishment has started, it's probably too late to work out an informal payment plan. Think one in the hand compared to two in the bush.

Here are the three ways to stop a wage garnishment once it has started:

• Pay the debt in full
• File a consumer proposal
• File a personal bankruptcy
  

When you file a consumer proposal or personal bankruptcy, you are protected by the laws of the Bankruptcy Insolvency Act. It's called a "stay of proceedings." That means that, in most cases, a wage garnishment would stop.

If you are concerned about a wage garnishment and want to better understand your options, your first step is to contact a licensed trustee in bankruptcy. You can contact us by telephone at 310-PLAN or 1-866-747-0660. You can also reach us by e-mail.