If you owe money to your credit card company, and if you stop paying them, they can sue you for the amount owed. If that same credit card company obtains a judgment from a court, they can take that judgment and garnish your wages.
But, let’s start from the beginning. You’re in need of money, so you apply for credit through a bank or a company that issues credit. All you see is how much they’ll give you, and in this example, you’re given $2,000 in credit. But what you don’t see are the interest rates and fees these companies will charge if you miss a payment or just pay the minimum amount.
Along the way, you’ve made purchases and will occasional pay the balance due, but sometimes you just pay the lowest amount you can, usually $25 a month. Now, the $2,000 credit the bank has given you has ballooned to $4,000 with interest and fees. You can’t afford the monthly payments anymore and you decide to let it go. From here, you’ll get phone calls, letters and emails about your missed payments, but eventually the bank or credit card company is going to pursue the amount you owe. They’ll either hire a law firm or sell your debt to a collection agency who will pursue the debt using their in-house law firm.
If the law firm obtains a judgment, then they’ll try to garnish your wages, or levy your bank account. There are exceptions, but two ways to cease the garnishment or levy is to either pay the entire amount you owe back, or file for bankruptcy.
Once you file a bankruptcy, an automatic stay is put into place and any lawsuits and garnishments have to stop. If your money was garnished after filing, then they have to return that money to you. Plus, if you have more unsecured debt, such as personal loans, medical bills and other credit cards, your liability for these debts will cease at the end of your bankruptcy!
CALL NOW FOR A FREE STRATEGY SESSION FROM A MN BANKRUPTCY LAWYER AT LIFEBACK LAW FIRM
So, if you have any questions about your debt and you’re thinking of filing for bankruptcy, please reach out to Minnesota’s nicest bankruptcy law firm by going to www.lifebacklaw.com. You won’t regret it!
