How to Stop Wage Garnishment in Tennessee

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parts

1Preparing to Respond to the Garnishment

2Responding to the Garnishment in Court

3Filing for Bankruptcy

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Tips and Warnings

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If you have an unpaid debt, such as an uncollected court judgment against you, then the creditor can bring several court actions to recover the money. The creditor can seize your personal property, try to foreclose on your house, or bring a suit to garnish your wages. With a wage garnishment, your employer will withhold a certain amount of money each pay period until the debt is satisfied. If a creditor seeks to garnish your wages, then you can try to exempt certain property and come up with a repayment plan of your own. However, it will be difficult for you to get out of paying back the creditor altogether.

Steps

Part 1

Part 1 of 3:

Preparing to Respond to the Garnishment

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   Understand when wages may be garnished. In Tennessee, nearly every kind of debtor can file a wage garnishment action if they have a court judgment against you for owing them money. Virtually every kind of debt can be included in a wage garnishment, including child support, student loans, back taxes, child support, and medical bills.

   • Some wages can be garnished without a court order. For example, creditors can proceed to garnish your wages without a court order for unpaid income taxes, court-ordered child support, child support arrears, and defaulted student loans.
   • If you want to avoid garnishment, then try to work out a payment plan with your creditor. You can petition a court to modify your child support payments, or you could work out a repayment plan with the federal government if you owe federal taxes. Rather than wait to be garnished, you should be proactive.
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   Calculate the maximum amount you owe. Federal and state law limits the amount that can be garnished. The intent of the limitation is to allow you some money to support yourself. Generally, you can exempt from garnishment up to $217.50 a week. Some income sources are also exempted: Social Security, VA benefits, and Welfare checks.

   • These maximums do not apply if you owe child support or if you have student loans in default. If you owe child support, then up to 60% of your disposable earnings may be garnished. If you are supporting a spouse or another child, then up to 50% may be taken. An extra 5% can be garnished if you are more than 12 weeks in arrears.
   • Federal law limits the amount student loan lenders can garnish to 15% of your disposable income but not more than 30 times the prevailing minimum wage.
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   Identify property exemptions. Tennessee law also allows you to protect property so that the creditor cannot seize it and force the property to be sold. Each individual can protect up to $10,000 in personal property, which includes cash or bank accounts. You will file a list of exempted property with the court.

   • You will not have to list some property because it is automatically exempt. For example clothing, family pictures, the family Bible, trunks, and school books are exempt.
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   Understand the homestead exemption. Tennessee law exempts a certain amount of value from your home, should the creditor foreclose on the house. The home must be your principal place of residence. If you are single, then you can exempt $5,000 from the sale of your house. If you are 62 or older, then you can exempt $12,500.

   • Married couples can exempt more. If you are married, then you can exempt $7,500. When one spouse is 62 or older, the exemption rises to $20,000. Where both spouses are at least 62, then the exemption is $25,000.
   • Homeowners with at least one minor child in their custody can exempt $25,000.
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   Meet with a lawyer. You can try to meet with an attorney to answer any questions you might have about wage garnishment and how to stop it. Tennessee law provides few avenues for those seeking to stop garnishment. Only a qualified attorney can answer can assess your situation and provide the best advice.

   • You should certainly meet with a lawyer if you owe back taxes. The amount that can be garnished and the methods the federal or state government can use differ from other kinds of garnishment.
   • If you can’t afford a lawyer, you can try to meet with a legal aid office. Legal aid organizations provide free or low-cost legal services to those in financial need. To find a legal aid organization near you, visit the Legal Services Corporation’s website at www.lsc.gov. You can search for legal aid organizations on the homepage by clicking “Find Legal Aid” in the upper right-hand corner.
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Part 2

Part 2 of 3:

Responding to the Garnishment in Court

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   Understand your limited options. There is only one way you can permanently get clear of a debt that you owe: file for bankruptcy. A bankruptcy will allow you to wipe out some (but not all) debts. However, you can take other actions that might help you deal with the garnishment. For example, you can protect property from seizure by filing a list of exemptions.

   • Also, you can file a Motion to Pay by Installments. By doing so, you can ask the court to set a repayment plan. Nevertheless, you still must repay the debt. A Motion to Pay by Installments might be helpful if you do not want an employer to know about the garnishment.
   • Additionally, you should file a Motion to Quash Garnishment if you legitimately do not owe the debt. However, you should not file a motion to quash if you know you owe the debt. A court will sanction you for filing a frivolous motion.
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   Find the right court. You need to file any documents with the General Sessions Court where the judgement was entered against you.
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   File a list of exemptions. You should pick up a “Notice of Exemptions” form from the court clerk and list all of your exemptions. You can then file it with the clerk free of charge.

   • You will need to sign the Notice in front of a notary. You should be able to do that at the courthouse.
   • Be sure to update your list should you come into possession of additional property that is exempt. You can update by filing a new list with the court clerk.
4. 
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   File a motion for installment payments. You can also file a Motion for Payment by Installments. This motion will allow you to avoid garnishment by having the court set the amount that you pay. Once the court sets the amount, you must make regular payments. You can get the form from the Clerk of court in any county.

   • To qualify, you must make at least $196.50 a week or have more than $4,000 in property.
   • You can file the motion even if your wages are already being garnished. By filing a Motion to Pay by Installments, you can temporarily stop the garnishment until the judge rules on your hearing.
   • To strengthen your motion, you should gather financial information, including proof of how much you make, your number of children, and your monthly bills (including rent, utilities, transportation, clothing, food, medical care, and child care).
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   File a motion to quash, if necessary. If you do not owe the debt that is the subject of the garnishment, then you will need to file a motion to quash. At the hearing, you can explain to the judge why you do not owe the debt.

   • Ask the court clerk for the form to use for a motion to quash. Fill it out and file it with the court clerk.
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   Attend a hearing. Whenever you file a motion, you will need to appear before the court to argue your position. You should arrive early, giving yourself enough time to find parking and go through security.

   • Dress appropriately. You should be neat and clean when you appear before a judge. Wear pants (not shorts) and tuck your shirt in. Under no circumstance should you wear tank tops, see-through shirts, flip-flops, do-rags, hats, hoodies, oversized jewelry, or clothing with offensive language or imagery.
   • Turn off your cell phone or any noise-making device before entering the courtroom.
   • Speak respectfully. You should always call the judge “Your Honor.” Stand when the judge enters and leaves. Also stand whenever you speak.
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   Make payment. If you prevail on the Motion to Pay by Installments, then you must make timely payments. Should you skip payments, then the creditor can get another garnishment put in place.

   • Payments are usually made to the court clerk. Be sure to list your docket number on the check.
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Part 3

Part 3 of 3:

Filing for Bankruptcy

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   Understand the automatic stay. When you file your bankruptcy petition, the court enters an “automatic stay” and sends notice of the stay to all of your creditors. The automatic stay prevents any creditor from attempting to collect on a debt. Accordingly, the automatic stay can stop most garnishments.

   • The stay does not apply to child support obligations, so those continue regardless if you file for bankruptcy.
   • When your bankruptcy ends, the stay ends. Nevertheless, if you managed to discharge your debt in bankruptcy, then the creditor cannot start another garnishment on that debt. However, if the debt was not discharged, then the creditor can pursue another garnishment.
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   Hire a lawyer. Bankruptcy rules are complicated. In order to qualify for a Chapter 7 bankruptcy, for example, you will need to pass a “means test,” which looks at six months of income. Your income is then compared to the median income of a similar household in your state to see if you qualify. Only an attorney can help advise you on whether or not a Chapter 7 bankruptcy is appropriate.

   • To find a qualified bankruptcy attorney, you can visit your state’s bar association, which runs a referral service.
   • Many attorneys will do a simple Chapter 7 bankruptcy for a flat fee. You can call the lawyer to ask about fees, or you can ask during a consultation.
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   Follow your attorney’s advice. Bankruptcy laws limit your ability to make certain purchases on a credit card or take out cash advances within a couple months of filing for bankruptcy. If you choose to file, then you should get your attorney’s advice about what you can spend money on.

   • Specifically, you cannot discharge luxury purchases if you make at least $650 in total charges for luxury items on a credit card within 90 days of filing for bankruptcy.
   • Similarly, you might not be able to discharge cash advances totaling $925 if taken within 70 days of the filing.
   • Although your attorney can fight to get these charges discharged, it would be better to avoid making them in the first place.
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   File a petition with the bankruptcy court. When your lawyer files, he or she will need a list of your creditors, including their address. In this way, the court can send them a notice that you have filed for bankruptcy. Be sure to include the name and address of the person who has a garnishment against you.

   • If the garnishment does not immediately end once the stay is put in place, you should contact your lawyer.
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Tips

• Federal law prevents your employer from firing you because of a wage garnishment. However, the law protects you only if you have a single garnishment. If you have two or more, then you can be fired from your job.
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