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Can filing for bankruptcy stop wage garnishment?

Dealing with financial challenges on a daily basis is simply a part of life for the vast majority of Americans. Many people are still dealing with overwhelming debt that they may have accumulated as they attempted to get through the so-called "Great Recession." Others are struggling to make monthly mortgage payments. Countless other financial problems weigh on the minds of Massachusetts residents every day. For some, the most limiting issue is wage garnishment.

For those who don't know, a wage garnishment order can be put into place on a person who is struggling with debt but who has a steady income. The wage garnishment directs a certain portion of a person's wages straight from the employer to the party that is owed. What options does a person in this position have? Can filing for bankruptcy stop wage garnishment?

In short, the answer is "yes." When a Massachusetts resident files for Chapter 7 bankruptcy, an order known as an "automatic stay" is entered with the court. This means that all debtors are barred from any collection efforts, and that includes wage garnishment. As a result, the filer will begin to receive their full earnings, which can be an immediate boon for someone who is facing financial challenges.

The wage garnishment will be halted for as long as the automatic stay is in place. And, for many people who are going through the Chapter 7 process, the debt that is subject to the wage garnishment order will likely be addressed in the bankruptcy filing - possibly even eliminating the debt that is owed.

Source: FindLaw, "The Automatic Stay: Stopping Creditors with Bankruptcy," Accessed Sept. 7, 2015

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