Legal Question in Credit and Debt Law in Wisconsin

Garnishments Before Bankruptcy Can Be Completed and Filed

Because garnishments rather mercilessly take 25% of gross income and can rarely be stopped before your bankruptcy is filed with the court, it is critical that you plan ahead and hire your bankruptcy attorney well in advance of any such litigation. If you have a steady job but a lot of credit cards in default, any attorney can pretty well assure you that a garnishment will be in your future within the next few months, if not sooner. You should therefore not delay in retaining your attorney and getting his staff everything they need (including money) as soon as possible. Unfortunately, once the garnishment begins, you may literally become too poor to even file your bankruptcy after the garnishment comes out of you paycheck each week. Attorneys’ are required by law to get the entire chapter 7 fee paid up front. Any portion of an attorney’s pre-filing date fees which are not paid prior to the bankruptcy filing is discharged and rendered uncollectable, along with most other debts, once the case is filed. Chapter 13 fees, on the other hand, can be paid over the life of the plan, along with dividends to all of the other creditors, so a smaller down payment to the attorney may be possible. If you are making more than the median income for the size of your household and do not have a large amount of secured debt, you may have little choice but to file a chapter 13 plan rather than a chapter 7 in any event. Good luck!