The creditors are calling and it is exhausting. You block all the numbers, but new ones manage to come up again. They start to send you letters telling you to pay. You get so many letters that you stop opening mail. Before you know it, you are now being served with a complaint from a debt collection law firm. The lawyers are suing you and trying to attach to your wages. What can you do?Trustee Process
Trustee process is the court process where a creditor's attorney tries to attach to something as collateral. Basically, the creditor's lawyer is telling the court that you are refusing to pay and the creditor needs the collateral to satisfy the debt.
The trustee is the holder of goods or funds, they are almost always a bank or employer. In the consumer bankruptcy realm, trustee process falls into two categories: wage garnishments and bank attachments.Wage Garnishments
Wage garnishments can be very problematic. They are problematic in situations where a debtor maybe had a few hard years, finally found a decent paying job, and now is faced with the prospect of having their higher wages attached to.
A wage garnishment is a court order to an employer to withhold a certain amount of funds from the employee-debtor's paycheck to pay a creditor. To obtain a garnishment, the creditor's lawyer needs to file a trustee process suit.
For example, a Bank might sue John Doe in 2010 for an unpaid credit card. John Doe decides not to respond to the complaint and the Bank gets the judgment for $10,000 against John Doe in 2011.
Years go by where the Bank's attorneys call John Doe to ask him to pay, but he does not respond. The judgment is accruing 12% interest per year and it is now over $20,000 in 2020. TheBank finds out that John Doe is working at Acme Corporation. In 2020, the Bank files a suit against John Doe and Acme Corporation as Trustee to attach to John Doe's weekly wages.
How much can the Bank take from John Doe's wages? The answer is it depends on how much John Doe is making. Massachusetts law would allow for Acme to withhold,
- 15% of the debtor's gross wages, or
- The debtor's disposable income less 50 times the state's minimum hourly wage
So, if John Doe is making $2,000 a week, the Court could require Acme to the Bank $300 per week under the first category. Under the second category, let's say John Doe's take home/disposable income is 2/3 of his gross income or $1,355. The state minimum wage is currently $13.50 times 50 is $675. Meaning, Acme could be required to withhold $680 per week under the second category.Bank Attachments
Another situation that a collection lawyer might try would be where they try to attach to the debtor's bank account. This is a common practice and many times the court will allow the creditor's attorney to file without notice to the debtor. Meaning, John Doe's bank account at Lowell Capital could be garnished and he only finds out when he checks on day and there is next to no money in it.
These attachments are also not without limitation. If the Bank attempted to clean out John Doe's account at Lowell Capital, they would not be able to touch the first $2,500 in the account. Meaning, if John Doe had $7,500 in the account, the Bank could end up with a check for $5,000 from Lowell Capital after the court allows the attachment.How to Stop Garnishments
Filing for bankruptcy, whether it's Chapter 7 or Chapter 13, will halt the trustee process action. The Lowell Bankruptcy Lawyers at Marcotte Law Firmcan give you the relief you need from pesky creditors. Call our bankruptcy attorneys today for a free consultation at (978) 458-1229.