Many Minnesotans are aware of what wage garnishment is and it is something that can be quite devastating to them.

When a creditor is seeking to collect a debt, they can seize a person’s wages or bank account through garnishment. They can actually seize up to 25% of wages, which can be a damaging amount of money.

Here is how wage garnishment works:

• The creditor’s attorney obtains a court judgment. If the debtor does not respond to the lawsuit within 45 days, their wages can be garnish.
• To garnish a person’s bank account, the creditor’s attorney sends a notice to the bank. The bank will usually freeze the money the day it gets the notice.
• The bank customer is not notified until after the money is frozen, which can result in bounced checks, failed ACH payments, and overdraft fees.
• To garnish your wags, the attorney for the creditor must send a notice to the debtor. The creditor must wait 10 days before notifying the employer.
• Your employer will be ordered to withhold a certain percentage of your paycheck and remit that payment to the court until the entire debt amount is paid in full. That payment must be accompanied by proper documentation.

If you have income from social security, veteran’s benefits, unemployment insurance, or any government insurance payments made to your bank accounts, that money can be frozen. However, the money from these sources can be gotten back. To do that, you have to send in a form that claims the exemptions. The form is sent to the bank and the creditor’s attorney. If no exemptions are claimed, the creditor can take part of the pay for 70 days. The debtor gets to keep the greater of 75% of the net wages or 40 times federal minimum wage. If you do file a motion through your attorney, the dispute could go to a judge.

There are some creditor attorneys that will release garnished funds if they agree to make a payment arrangement. When the debt is, in fact, owed, this could be a good route to take. However, it is imperative to ensure the attorney for the creditor can verify the existence of the debt. If they cannot do so in 30 days, then you are not required to pay any money toward that debt.