Full question:
I currently am paying on a loan for my truck. Recently, due to some unfortunate events, I am unable to afford the extremely high payments. I have exhausted all possible solutions other than returning the car as a voluntary repossession. I know that once I do this, there will be a sizable balance I will owe on the loan. I have no problem making a regular payment to take care of the balance, but I cannot afford anywhere near the original loan payment. Does the Lien-holder have the ability to garnish my wages even if I am making regular payments each month? If so, is there any legal recourse I have to avoid garnishment?
- Category: Debts and Credit
- Subcategory: Garnishment
- Date:
- State: Wisconsin
Answer:
Yes, the lienholder may be able to garnish your wages if you fail to meet your loan payments. Here are some options you might consider:
- Repay the debt by negotiating directly with the creditor.
- File a proposal to creditors.
- File for bankruptcy.
Once a creditor initiates garnishment proceedings, it can be challenging to stop without filing for bankruptcy. Certain jurisdictions offer property exemptions that can protect some of your assets from creditor collection efforts. To claim an exemption, you must file the appropriate paperwork with the court and notify the creditor of your intent to exercise this exemption.
This content is for informational purposes only and is not legal advice. Legal statutes mentioned reflect the law at the time the content was written and may no longer be current. Always verify the latest version of the law before relying on it.