If I File Bankruptcy, Will My Creditors Stop Garnishing My Wages?

Automatic Stay

At least for a short time, you can definitely stop creditors from garnishing your wages by filing bankruptcy. The mere act of filing a bankruptcy petition enacts the automatic stay, which is a temporary court protection blocking collection activities such as wage garnishment. The automatic stay remains in effect until the court renders a decision in the case. As soon as your creditors receive notification from the court that you filed a case, which typically arrives a few days after you file, they must by law cease all wage garnishments and other collection activities.

While the automatic stay is a nice temporary reprieve from your wage garnishment, what you should be hoping for in bankruptcy is a permanent end to the garnishment. Assuming you qualify for bankruptcy and follow all court instructions, you should ultimately receive a bankruptcy discharge, which can put an end to your wage garnishment once and for all. If your creditors have already begun garnishing your wages, you will have to take the extra step of contacting the court that ordered the garnishment against you. You must file a motion to vacate a judgment with the court and inform them of your bankruptcy in order to formally end the garnishment.

If the court dismisses your bankruptcy case for any reason, you are no longer under the protection of the automatic stay. As the court notifies your creditors when you file bankruptcy, it also notifies them in the event of your case dismissal. With the automatic stay no longer in effect, your creditors can resume collection activities, including wage garnishment.

If you receive a bankruptcy discharge, your protection only applies to debt you incurred before you filed bankruptcy. Your creditors can begin or resume wage garnishment on any unpaid debts you incurred after you filed bankruptcy. Further, once you receive a bankruptcy discharge, you cannot get another one for as long as eight years, so you are stuck with any wage garnishments for post-bankruptcy debts (see Resources).