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‘Can a credit card company garnish wages?’ is one question you may be asking if you have fallen behind on some of the payments that you owe your lenders. Credit card companies have several ways that they attempt to collect monies owed without going to the expense and time of a court filing to collect. One way they encourage collection is the threat of paying higher rates of interest if you cannot make the payments and make them on time. Another way is to charge you fees when you do not pay on time or when you go over the allowable limit on the card. When these measures have failed the company may try some other options first.

One option is to make phone calls and send letters to entice you to negotiate a settlement of the debt. The creditor can put a lien against your tangible assets and they can freeze some of your banking accounts to encourage you to settle the debt. The company may hire an agency to collect the debt or they may sell your debt to agencies that purchase bad debt before the credit card company can garnishes wages as a last resort.

The process of garnishment is when the creditor petitions the court for a judgment and a writ that can be used to collect unpaid debt. The writ will allow the creditor to attach your assets for payment and will allow the credit card company to garnish wages. The judge will issue the order and the creditor will send the paperwork to your employer so the withholdings can begin to make payment on the debt until you have paid in full. The company will have to hire an attorney familiar with the proceedings to file the request with the court. This will cost the company a lot of time and money and most private companies will not go to the trouble of pursuing this course of action.

The Federal Trade Commission says there are federal benefits that are exempt from garnishment by creditors. Social Security income, income from retirement and income from disability cannot be attached to pay debt. Some states do not allow private companies to attach wages and some severely limit the amount that can be taken. Some states only allow a government agency to take earnings through this type of withholding. These laws vary greatly, according to information provided by the Federal Trade Commission and the BCS Alliance. If you are a creditor and you want to go through the expense and the time of attaching the wages in order to collect on a debt, you should hire the services of an attorney that specializes in these proceedings. If you are a debtor and you know that a credit card company can garnish wages in your state you will also need to hire the services of an attorney that knows the laws that govern this court process in the state in which you live.