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How Much Can Debt Collectors Garnish?

Dena Standley | April 23, 2024

Dena Standley
Legal Expert, Paralegal
Dena Standley, BA

Dena Standley is a seasoned paralegal with more than 20 years of experience in legal research and writing, having received a certification as a Legal Assistant/Paralegal from Southern Technical College.

Edited by Hannah Locklear

Hannah Locklear
Editor at SoloSuit
Hannah Locklear, BA

Hannah Locklear is SoloSuit’s Marketing and Impact Manager. With an educational background in Linguistics, Spanish, and International Development from Brigham Young University, Hannah has also worked as a legal support specialist for several years.

Summary: In most states, debt collectors cannot garnish more than 25% of your wages, but garnishment laws vary by state. Prevent wage garnishment before it happens by settling your debt with the help of SoloSettle.

Debt collectors can garnish up to 25% of your disposable income for consumer debts such as personal loans, medical bills, and credit card debt and up to 15% for student loans. Disposable income is the income you have left after all required deductions, such as Medicare, Social Security, and state and federal taxes, are deducted.

They can also garnish your disposable income that exceeds 30 times the federal minimum wage (federal minimum wage is $7.25). If your income meets both criteria, they pick the one that is the lesser of the two.

Regardless of the percentage a creditor is allowed to take, garnishment can lead to a substantial financial setback. Below, we explore whether wage garnishment is legal, what types of earnings can be garnished, and the wage garnishment process. We will also explain your options to protect your money from garnishment.

Don't like reading? Check out this video where we ask an attorney about debt collectors and wage garnishment instead:

Is wage garnishment legal?

Yes, the wage garnishment process is a legal tool that creditors use to collect money from consumers who defaulted on their debt and have ignored collection attempts. However, the creditor must receive court permission to access your disposable income.

Most states allow creditors to garnish consumer wages, but you must adhere to the state’s wage garnishment laws. The state laws often provide additional protection or may impose stricter measures beyond the federal guidelines.

For example, Arkansas follows the federal garnishment laws except in situations where the debtor is a mechanic or laborer. For these individuals, 60 days of wages are exempt from garnishment after the court order is made. Afterward, the first $25 the laborer or mechanic earns weekly is exempt from garnishment. Then there are states like Texas, which does not allow wage garnishment for consumer debt.

Avoid wage garnishment.

Negotiate debt settlement to block a default judgment and avoid wage garnishment. SoloSettle makes debt settlement easy.

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What earnings can be garnished?

The Consumer Credit Protection Act (CCPA) describes earnings as any money you receive as compensation for a personal service. These earnings include:

  • Commissions
  • Salary
  • Wages
  • Periodic payments for pension
  • Employment-based disability funds
  • Bonuses
  • Tips paid by an employer

Even when you receive a lump-sum payment that you think should not be treated as earnings, the courts will investigate whether the money received was paid out for services you rendered. If so, it will be subjected to garnishment. But it will not be garnished if it is not related to personal services, such as an inheritance or gift. Let’s look at an example.

Example: Jake, who has a debt with Advantage One credit company, received a bonus of $602 because he did a great job with a big client. After the deductions were made as required by law, the total disposable income remaining was $468. That week, 25% of Jake’s bonus underwent garnishment (25% x $468). He received a check that had $117 less.


To avoid being in Jake's situation, respond to your debt lawsuit to prevent a default judgment and subsequent garnishment. Watch the following video to learn more.

What earnings cannot be garnished?

Fortunately, not all the money you receive can be garnished. Exemptions that are protected at the federal and state level include:

  • State disability benefits
  • Veteran federal benefits
  • State welfare benefits
  • Social Security benefits
  • Disability payments
  • Supplemental security income benefits
  • Compensation for unemployment
  • Child support payments received

Money in your account that falls under these categories will not be garnished, but you must provide evidence in court.

How long do I have before a debt collector garnish my wages?

The short answer is 30 days.

After a debt collection agency wins a debt collection lawsuit, they may receive a wage garnishment order. In most states, a consumer must be notified of the case outcome and that a garnishment order is in place. Next, the creditor notifies your employer in writing of the order and the legal requirement to comply. This notification should also give the date on which it should take effect, which can be 5–30 days.

You can dispute the order's legality and your ability to pay within 30 days of receiving the notice. At this point, you can provide evidence that your earnings are protected or you have other garnishment orders in place. The court can also request the employer to provide additional information on whether you have other garnishment orders in place. They must respond within 30 days after receiving the garnishment notice.

How to protect your money from garnishment

Protecting your money from garnishment or stopping the garnishment order can take place in two stages: after receiving the lawsuit and before going to court, or after receiving the garnishment notice. Let's explore the two.

Stop wage garnishment before it happens

Consumers sometimes choose to ignore a potential lawsuit in hopes that the creditor will not follow through. Unfortunately, many debt collectors follow through with the lawsuit. If the consumer fails to respond to the suit, they miss their opportunity to argue their case in court. Instead, the best course of action is to respond to the lawsuit with an Answer.

In the Answer, you get the chance to explain your side of the story and state the reasons why you should not pay (in the affirmative defenses section) or ask the creditor to prove that the debt is actually yours (by denying the allegations). When you respond to the lawsuit, you increase your chances of the creditor withdrawing the case and agreeing to settle for less than you owe. Ignoring a lawsuit worsens your debt situation because you may be forced to pay the creditor’s attorney fees and court charges.

Stop wage garnishment after an order has been entered

You still have rights even after the debt collector receives permission to garnish your wages. For instance, they must legally notify you of the garnishment order before your employer deducts the money. You can also file a dispute letter if the notice contains incorrect information or the debt is not yours.

You can also challenge the court judgment if you believe the entire case was made in error or the court’s decision was wrong. To do this, you must file a motion to vacate judgment into your case. This would reverse the judgment and give you another opportunity to defend yourself.

Avoid garnishment by settling your outstanding debts

Your employer cannot fire you from work because of a garnishment order, but it doesn't mean they won't judge you for letting your debts get out of hand. Luckily, you can settle debt before wage garnishment happens, even if you've already been sued.

SoloSettle is a tool that helps you approach debt collectors with a settlement offer before they go to court to seek a garnishment order. The app has a pre-drafted template that is customizable to your situation. Within the app, debt specialists monitor the negotiation process. Afterward, SoloSuit takes care of the paperwork to ensure the creditor keeps the end of the agreement. Start working on your settlement letter with us today.

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