How to Handle Wage Garnishments – Ontario

A wage garnishment could be a real agony, and often just feel completely unfair. Not only do you lose the hard earned money every pay-check, but also you could lose control of your finances, credit as well as confidentiality. No-one wants their manager and employers to learn about your financial obligations and current financial circumstances. So the main question is how does one stop wage garnishments? There are quite a few options, but first let's talk about in more detail exactly what a wage garnishment is actually.

What Is Wage Garnishment

Wage garnishment happens when your lender is legally capable of get payment out of your wages via your employer. It'll mainly happen if the lender is suing you and taking you to court, and they'll only generally do that if you owe them a sizable enough sum of money to make it worthwhile. If successful your creditor may well then take the Garnishment Order to your organization, who then doesn't have any choice but to respect and abide by the procedures. It should also be noted that there are actually two occasions where wage garnishment can be accomplished without going through the court. The first occasion occurs when you've offered an assignment of wage to a credit union, and lastly when you owe back taxes to the Canada Revenue Agency. These are the just two exceptions. The actual amount of your garnishment will vary based on circumstances and will be decided by the the courtroom.

Stop Wage Garnishments

Now we have discussed what it really means, let us get down to business. Exactly how do you stop wage garnishments? The first port of call should probably be to try and reason with the creditor, and try your best to convince them that you will be capable of paying them back without the garnishment, but keep in mind that this will most likely not succeed. Truth to say, they wouldn't have gone to the cost of taking you to court to begin with until you owe them a lot of money and have a record of not paying out promptly, or they've other reason to believe you would not honour the repayments.

Pay Off Debt

Putting aside the above, there are just three alternative ways you can stop wage garnishments. Number one is to simply pay back the debt. This is typically not an alternative for you should you have found yourself in this situation to start with.

Consumer Proposal

The second approach is to file a consumer proposal to creditors, a beautiful alternative should you not want to seek bankruptcy relief. It involves forming a legal binding agreement between you and your creditor through a consumer proposal administrator. This agreement will shield you from collection agencies, and will set up a partial repayment schedule where you promise to pay back the debt that you owe and the creditors consent to forgive the rest of the balance. This can be an attractive option should you wish to stop wage garnishments.

Personal bankruptcy

The final option available to you would be to declare bankruptcy. Like I said previously there are more options to consider if you reside in Canada and would like to stop wage garnishments, and bankruptcy should usually be viewed as a last option. The dangers and consequences of declaring yourself bankrupt needs to be seriously reviewed, and you should remember that this is not the only real solution available to you personally.