Wage garnishment in AZ

[U2ForNow]

I live in Arizona and just had my first wage garnishment for a judgment. The judgment is for a business loan that I personally signed for. I make $10.10 an hour and receive approximately 8 hours of overtime a week. After paying for benefits, union dues, and taxes, there is not a lot left.

I was under the impression that a creditor can not garnish wages if you make under a certain amount. Does anyone know if this is true? Or how to verify it? I did some research and I came up with nothing but confusion. I will be unable to pay rent and my car payment now. Any ideas?

Thanks in advance for your advice.

[lrprn]

(fyi....for U2's history - over a million dollars owed from a folded business, recent divorce, unable to file Ch 13 due to amount owed, etc, see http://www.bankruptcyforum.com/showthread.php?t=8088)

Sorry to hear your troubles are continuing, U2. Here's some information about Arizona's garnishment statutes - source is http://www.fair-debt-collection.com/...shments.html#3 :



Is the amount that is being garnished from your paychecks match this stated calculation for wage garnishment in Arizona?

I was under the impression that a creditor can not garnish wages if you make under a certain amount. Does anyone know if this is true? Or how to verify it? I did some research and I came up with nothing but confusion. I will be unable to pay rent and my car payment now. Any ideas?

After researching several Arizona academic and private law websites about wage garnishment, I found no mention of a minimum dollar amount limit involved in wage garnishment in Arizona anywhere. Of course, the only way to know 100% that is correct is to make a free appointment with several local bk lawyers and ask.

By the way, did you contact your garnishment creditor before the hearing to see if you could work out a payment plan? And did you go to the garnishment hearing to object to the garnishment on hardship grounds?

[U2ForNow]

Thanks for the reply.

25% of the statutory net disposable earnings of debtor. Court may reduce to as low as 15%.

Thank you for your response. I was trying to better understand disposable earnings. I think now I understand that it is not my disposable earnings, but rather what is left after taxes, etc.

By the way, did you contact your garnishment creditor before the hearing to see if you could work out a payment plan? And did you go to the garnishment hearing to object to the garnishment on hardship grounds?

I was never made aware of a garnishment hearing. I just received the notice in the mail that my employer was notified.

Although my problems continue, I have kept in touch with the creditors. I owe this particular creditor $220k, so there is no chance of working out a payment plan. (That will ever pay it off)

As soon as I can save $2500 I will file for bankruptcy. I think the creditors realize that I can not afford an attorney at this time. I made the mistake of telling them this in court.

I have also been told by several attorneys that there is a good chance that my bankruptcy will not be approved.

[GoingDown]

I will look into the garnishment issue, but I think I remembered someone saying you would have to make less than the state of Arizona poverty level to qualify for this kind of exemption from garnishment, and I think that is less than $817 per month, which is the amount set by A.H.C.C.C.S., if you are familiar with that program.

Why won't you qualify for bankruptcy?

[U2ForNow]

Thanks for the reply.

I will look into the garnishment issue, but I think I remembered someone saying you would have to make less than the state of Arizona poverty level to qualify for this kind of exemption from garnishment, and I think that is less than $817 per month, which is the amount set by A.H.C.C.C.S., if you are familiar with that program.

Why won't you qualify for bankruptcy?

[lrprn]

U2, bankruptcy is very serious business, especially when the debt amounts are as high as yours. In your situation, filing pro se "just to see what happens" is a terrible idea! Please don't allow your feelings of desperation and despair to push you into doing something, anything, just to be doing something.

Keep interviewing bk lawyers in your area. Interview ten if you have to so you get a good idea of what all the possibilities are in your situation. Costs nothing but your time and you will understand your options, whatever they may be, as well as possible. Hang in there - we are here to listen whenever you need an ear. Keep us posted on what you find out, ok?

[U2ForNow]

Thanks but

U2, bankruptcy is very serious business, especially when the debt amounts are as high as yours. In your situation, filing pro se "just to see what happens" is a terrible idea! Please don't allow your feelings of desperation and despair to push you into doing something, anything, just to be doing something.

Keep interviewing bk lawyers in your area. Interview ten if you have to so you get a good idea of what all the possibilities are in your situation. Costs nothing but your time and you will understand your options, whatever they may be, as well as possible. Hang in there - we are here to listen whenever you need an ear. Keep us posted on what you find out, ok?

What is the downside to Pro Se? I think at this point things can't get any worse.
In the event the case is dismissed I am in the same boat regardless. Am I missing something?

Thanks for your advice and care.

[HHM]

If you file pro se, at least do some homework so you don't make any easily avoidable mistakes.

The affects of dismissal don't put you in the "same boat". For one, you cannot refile for 6 months after dismissal; also, your subsequent filing is, for all practical purposes, presumed fraudulent, and the automatic stay expires after 30 days from the date you file. If blow it, and try to file again, it becomes a much more inconvenient and expensive process.

If you really screw up the first time around, you could get a "denial of discharge", which means you are totally screwed. A denial of discharge means you can NEVER discharge the debts in BK.

The first things you need to do, (1) stop using all credit. (2) attend the Bk pre-filing class, (3) and continue to interview lawyers.

[GoingDown]

I have heard of AHCCCS. I was told that bankruptcy was not an option because my debt exceeds the amount allowed in Chap 7, and based on my income and debt, I would not be allowed to file Chap 13. I was also told that because of the wording in my divorce decree that this would prevent it as well. I had two lawyers refuse the case on the grounds that my case might have to be challenged and go through the appeals process. (All based on the new laws)

I had only one lawyer that was willing to take on my case for $2500. He made it sound like it would not be a problem. This made me question if he just wanted to collect a fee or not.

I have been selling my personal belongings including things that I did not wish to part with in order to survive. I am almost out of options and have no idea how or where I will be living now that my wages are garnished. I used to wonder how some people become homeless, now I understand.

Who told you that there was a debt limit for Chapter 7?

I would say your first priority is to keep yourself from becoming homeless, and if that means downsizing to something more affordable under your new circumstances, then do that (for example, some parts of Phoenix have studio apartments for rent in the $295 per month range, even if they are in the barrios areas, it's still a roof over your head, and if check the Arizona Republic classified ads or the New Times ads, or even Craig's List, you can often find rooms for rent for about $100 per month). If it means swallowing your pride and moving in with relatives or friends until you can get back up on your feet again, then do that. Start looking for alternatives now so that you can live on 75% of your income, before you end up on the street.

I hope everything works out for you. I know what financial free-falling feels like, and I know that I had to adjust my way of thinking to accept the new reality of my situation and make some huges changes in my life so that I could afford to pay my monthly expenses and fixed costs-- a cheap rental house in the "less desirable" part of Phoenix, utilities, and cheap, affordable transportation-- an old, but reliable Ford Ranger truck from the 1990s.

After you have your situation stablized, then you can focus on finding a good bankruptcy attorney to give you the best chance of starting over with a new life. You might find that you simply have to wait it out and not file for bk until a certain amount of time has passed so that your bankruptcy can go through the court without being contested by creditors crying fraud.

You might also think about your skills and options so that you could perhaps get a job where your wages are not very easily garnished. Temp jobs and contract jobs are often difficult to garnish. The Arizona Department of Economic Security usually has a lot of listings of temp jobs available, and they can arrange the interviews with the prospective employers for you at no cost to you.

People who are self-employed are also less likely to have their income garnished, if you have the necessary skills to start your own business. I started my own lawn mowing business and the start up costs were minimal-- a lawnmower, an edger, a tarp, a garbage can, a rake and a shovel is all I needed to get going at first. Then I ran an ad in the Arizona Republic and the jobs came flooding in. Now I don't even advertise because I have more referrals than I can handle at the moment. That's just an example, but there are lots of other things you might consider doing that match your skills and abilities.

[lrprn]

What is the downside to Pro Se? I think at this point things can't get any worse.

How about filing pro se not understanding the fine interpretations of the law and so you come to the attention of the US trustee who then asks you to produce years of financial records while your creditors object to your discharge and do their best to take everything you have? Compare this to finding the best bk lawyer you can who may be able to help you sort your way out of this mess so if you do come to the attention of the US trustee, you have someone on your side who understands the law. I know which one I would choose!

In the event the case is dismissed I am in the same boat regardless. Am I missing something?

Having your bk dismissed adds yet one more layer of complexity to your already very complicated case plus it could take away your "magic bullet" for at least six months plus open the door to presumed fraud - that could lead to a ruling that will prevent you from EVER being able to discharge your debt. Why deliberately dig yourself into a hole of your own making when that could be avoided by retaining a lawyer?

Thanks for your advice and care.

We *do* care about you, U2! Please don't make any hasty decisions - the long-term consequences are too severe to file on your own in a very complex case just because you are desperate to find a way out. Keep asking questions and hang in there!

[Lexy1969]

I live in AZ and am almost complete with the paperwork. I was talked out of filing earlier last year by a very knowledgable attorney in Chandler. Im not promoting him in any way but his name is Ashton Call. A free consultation is all it costs you and I think you will feel more comfortable with him than scumbags like (Phillips Law.. Law?? what a joke)

The only reason I was talked out of it is because I thought I could pull out of the income situation and settle with some of the creditors. Not happening so we are filing as soon as I can come up with the $850 to pay him.

My creditors have now started hiring local attorneys so Im sure garnishment is the next step.

Good luck with your situation. He is at Elliot and Dobson 480-969-6015